External Background.
On Friday, American stocks ended the previous week with a noticeable decline. The Dow index fell by 0.9%, while the Nasdaq dropped by 0.8% and the S&P 500 by 0.7%. The negative dynamics continued amid a global technical failure of Crowdstrike software, which led to a Windows operating system crash in many airlines, banks, and other companies. It is also noteworthy that the ongoing earnings season has been relatively good, with 83% of the 70 S&P companies that reported exceeding market expectations. However, the energy sector experienced the most significant decline on Friday. Oil prices fell by 2.6% on Friday, negatively concluding a second consecutive week of losses. The plenary session of the Central Committee of the Communist Party of China ended on Friday with a long list of economic goals that were not positively received by the market, likely impacting oil prices. The European Stoxx 600 index also fell by 0.9%, marking the largest weekly decline this year. Additionally, Asian markets showed a decline on Friday, with the Hang Seng Index in Hong Kong dropping by 2% and Japan’s Nikkei 225 by 0.2%.
Bonds.
The yield on 10-year U.S. Treasuries slightly increased on Friday from 4.2% to 4.24%.
KASE Index.
The KASE index recovered by 0.6% on Friday, largely thanks to recent underperformers Air Astana and Kcell. Thus, despite a noticeable drop on Thursday, the index continued its movement within a local sideways trend.
Index Stocks.
The main growth on Friday came from Air Astana and Kcell stocks, which had shown significant declines in recent days. Air Astana rebounded by 4% on KASE on relatively higher volumes. However, its GDRs on the LSE fell by 1.4%, although they still traded at a premium to the shares. Of course, it is too early to talk about a global reversal in the stocks, which, if it occurs, will likely be after the financial report for the second quarter is released on August 1. Kcell shares also recovered by 3.2% on relatively low volumes, briefly increasing by 7.7%. Thus, the quotes returned to the previous sideways range, but it is still premature to draw conclusions. Additionally, shares of KazMunaiGas fell significantly (-1.8%), which will likely move within a narrow range in the coming days, following the global upward channel. Kazakhtelecom shares declined by 0.7%, breaking down from the local sideways trend and heading towards 38,000 tenge. ADRs of Kaspi.kz fell slightly on Friday against the backdrop of the overall decline in American markets. Remember that the second-quarter report will be released today, and a conference call for the market will take place, which may determine the dynamics of the securities this week.
Currency.
On Friday, the dollar significantly retreated in currency trading after three days of consecutive growth. The last deal price dropped by 3.58 tenge, reaching 475.39 tenge. Although during trading the dollar went above 480, it likely triggered sales from the National Bank, as trading volumes surged to $170 million compared to Thursday.