Our Comments and Expectations
External Background. The S&P 500 rose by another 0.6%, nearly reaching new historic highs set on December 6, 2024. The main gains came from the technology sector: Nvidia added 4.4%, Microsoft 4.1%, and Oracle 6.7%, driven by news of major investments in the AI sector. However, the index's growth was limited as other sectors did not show the same positive dynamics, highlighting the issue of market breadth. JPMorgan CEO Jamie Dimon mentioned signs of overheating in the U.S. stock market. Today, investors will be awaiting the release of data on initial jobless claims, which are expected to reach 220,000. In Europe, the Stoxx 600 briefly reached historic highs, then pulled back, but still closed in positive territory. Other eurozone indices also showed growth, except for the UK's FTSE 100. In Asia, the mainland Chinese CSI 300 index is rising on news that Chinese authorities have asked insurers and mutual funds to increase investments in stocks. Japan's Nikkei 225 is also up due to news that Japan's exports rose for the third consecutive month in December. According to an economist survey, the Bank of Japan plans to raise interest rates to the highest level since 2008 on Friday. South Korea’s GDP growth slowed to 0.1% in Q4, falling short of expectations. Oil prices are slightly down today, continuing a six-session downward streak. U.S. crude oil inventories increased by 1 million barrels last week, according to API. Gold, on the other hand, has risen to its highest level in the past 11 weeks.
Bonds. The yield on U.S. 10-year government bonds has stabilized its decline and reached 4.6% again. Corporate bonds declined.
KASE Index. The KASE index rose by 0.3% yesterday, preventing the correction from two days ago from continuing.
Index Stocks. CCBN stocks rose again after a noticeable drop on Tuesday, which hinted at a potential reversal. Such volatile directional shifts may indicate a transition to a broader local sideways trend. KMG remains the leader in declines, continuing its correction due to falling oil prices. Kaspi added 1%, although showing weak signs of a rebound. Kazakhtelecom lost 1.4% and looks weak technically. Yesterday, there was an interesting incident with the company’s preferred shares: trading was halted after a more than 30% drop. At first glance, it might have seemed like a large movement began in the stock, but the cause was more prosaic: a single market order to sell approximately 3 million tenge worth of stock "crashed" the illiquid order book, causing the sharp price drop. On the LSE, Kazatomprom was the leader in growth, benefiting from the overall rise in the uranium sector.
Currency. This morning, the dollar is trading around 521.5 tenge, slightly higher than yesterday's close. The 50-day moving average, which we consider a strong support level for the dollar, is at 518.3 tenge.