UPDATE 1-Volatile rouble slumps to 10-day low; Gazprom shares extend losses

* This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine (Updates prices, adds details and Locko Invest comment)

MOSCOW, July 1 (Reuters) - The Russian rouble plunged more than 6% against the dollar on Friday to its weakest level in 10 days, while shares in Gazprom extended losses after the gas giant cancelled dividend payments, pressuring Russian stock indexes.

As of 1019 GMT, the rouble was 5.9% weaker against the dollar at 54.50, earlier hitting its weakest point since June 21 at 54.9250. The currency scaled its highest level in more than seven years on Wednesday.

The unit lost 5.9% to trade at 56.85 versus the euro .

The likelihood of the rouble strengthening past 50 to the dollar has eased, said Dmitry Polevoy, head of investment at Locko Invest, although high commodity prices were supporting the Russian currency.

The rouble has become the world's best-performing currency this year, boosted by measures taken to shield Russia's financial system from Western sanctions imposed after Moscow sent troops into Ukraine on Feb. 24.

The measures have included restrictions on Russian households withdrawing foreign currency savings.

The rouble's strength has raised concerns among officials and export-focused companies because it dents Russia's income from selling commodities and other goods abroad for dollars and euros.

Expectations that Russian authorities could resort to foreign currency interventions were putting pressure on the rouble, Polevoy said.

DIVIDEND FALLOUT

Shares in Russian energy giants Rosneft and Gazprom followed divergent courses as investors responded to the two companies' opposing dividend decisions.

Gazprom's shares were down 5.5%, extending heavy losses from the previous session after the gas giant decided not to pay dividends on last year's results for the first time in more than two decades.

Meanwhile, shares in oil major Rosneft, which approved 2021 dividend payments after Thursday's closing bell, were gaining ground, up 4.5%.

"There are few reasons for optimism in the Russian market," said Otkritie Research in a note.

The commodity sectors of the market will be under pressure and the rouble may lose some ground before the weekend, Otkritie said.

Russian stock indexes were mixed, with the dollar-denominated RTS index shedding 4.3% to 1,286.8 points, hitting its lowest mark since mid-June.

The rouble-based MOEX Russian index was 1% higher at 2,225.8 points.

(Reporting by Reuters; Editing by Gareth Jones and Sherry Jacob-Phillips)