External Background.
On Friday, U.S. stocks resumed their upward trend after a decline on Thursday. The Nasdaq, Dow, and S&P 500 indices rose almost synchronously by 0.6%, while the Russell 2000 increased by 0.9%. The main theme of the day was the start of earnings season. Banks were the first to report, generally showing mixed results. Wells Fargo's shares fell by 6% after missing forecasts for interest income, while Citigroup and JPMorgan's shares declined by 1.8% and 1.2%, respectively, despite a slight increase in investment banking revenues. European stocks also rose amid reports from local companies. The Stoxx 600 index increased by 0.9%, reaching a monthly high. The Hong Kong Hang Seng fell by 1.4% in the morning, while the Korean and Chinese indices showed neutral results. Japan is on holiday today, and the Nikkei 225 fell by 2.4% on Friday due to a sharp strengthening of the yen by 2.3% over Thursday and Friday. Oil prices dropped by 0.7%, despite a weakening dollar and likely due to declining consumer sentiment in the U.S.
Bonds.
The yield on U.S. 10-year Treasury notes continued to decline on Friday, from 4.21% to 4.19%.
KASE Index.
The KASE index decreased slightly by 0.14% on Friday, largely due to declines in telecommunications companies. On the other hand, KazMunayGas continued to set records, and Kazatomprom partially regained lost positions.
Index Stocks.
KazMunayGas shares continued to rise on Friday, albeit at a more modest pace. Nevertheless, the shares reached a historical maximum of 13,500 tenge. Trading volumes again declined, but the scenario for local growth to 13,800 tenge remains relevant. The leader on Friday was Kazatomprom, whose shares recovered by 0.7%, even despite the strengthening tenge, reflecting the increase in GDR value on Thursday. On the flip side, Air Astana's GDRs fell by 3.9%, returning to previous levels despite a 15% year-over-year increase in passenger traffic in Kazakhstan for the first half of the year. Another important piece of news on Friday was a 25 basis point decrease in the base rate, which slightly increases the attractiveness of stocks. Kcell shares likely broke through the lower boundary of the long sideways range at 2,950 tenge and may continue to decline in the coming days. If there is no sharp reversal in the next couple of days, prices may drop to 2,720 tenge. Kazakhtelecom also experienced a correction for the second day, yet it fits into the current upward trend but may drop slightly to 38,800 tenge.
Currency.
On Friday, the dollar fell for the third consecutive day, reaching a level of 473.35 tenge. The latest news about an additional sale of $970 million from the National Fund over the next four months to purchase shares of Kazatomprom will likely strengthen the tenge against the dollar in the coming days.