LONDON (AP):

Russian stock markets rose on Monday as investors focused on the long-term opportunities offered by Russia's booming economy instead of the clash between Russia and Georgia over the province of South Ossetia.

News of the fighting in the South Ossetia region on Friday sent Russia's RTS stock index down 6.5 per cent to a two-year low, but by market close Monday, the index had regained 1.2 per cent following Russian President Dmitry Medvedev's announcement that the army had completed a "significant" part of its operations.

Meanwhile, the dollar-denominated MICEX index gained 3.9 per cent on Monday. In another sign the fighting was not fuelling panic, oil prices fell, despite concerns the conflict could disrupt pipelines running from Caspian fields across Georgia to the Black Sea and the Mediterranean.

"It is clearly a very upsetting event that has led to indiscriminate market selling and Russia's perception in the West will suffer as a result," said Elena Shaftan, head of Jupiter's Emerging European Opportunities fund, which has around £600 million (US$1.1 billion) under management, nearly half of that in Russia. "However, it has no significant impact on Russia's economic fundamentals and corporate earnings and at the end of the day we firmly believe this is what ultimately drives the markets, rather then emotions and swings in investor sentiment. We feel Russia represents a buying opportunity."