Our Comments and Expectations
External backdrop. Yesterday, the S&P 500 once again opened lower amid economic data releases but managed to finish the day up 0.6%. Reports indicate that wholesale inflation in the U.S. accelerated in April to its fastest pace since 2022. The Producer Price Index rose 6% year-over-year, exceeding all forecasts. Technology stocks were the primary drivers of growth, as the sector has recently been ignoring signals of persistent inflation and increasing odds that the Federal Reserve will keep interest rates unchanged. As a result, the Nasdaq 100 jumped 1.2% yesterday. Additional positive momentum came from Cisco’s results: after the market closed, the company released sales guidance above market expectations, causing its shares to surge 19%. Morgan Stanley also gave a positive outlook for the S&P 500 yesterday, raising its 12-month target to 8,300 points, implying upside potential of 11.5%. Yesterday, Trump arrived in Beijing for a meeting with Xi Jinping, where tariff reductions are expected to be discussed. In Europe, indices rose by 0.6–0.8%. France’s unemployment rate unexpectedly climbed to its highest level in five years. This morning, leading Asian indices are showing mixed performance. Futures on the S&P 500 are up 0.24%. Oil posted a moderate decline yesterday. The IEA reports that oil consumption in the current quarter will decline by 2.45 million barrels per day, marking the sharpest drop since the beginning of the pandemic.
KASE Index. The KASE index fell another 0.7% yesterday, approaching the critical support level near 7,560 points. A break below this level could open the way for a broader decline. However, judging by today’s market open, the risk has eased for now, with the market gaining 1%.
Index stocks. The main pressure on the index yesterday came from Kazatomprom shares. In general, the uranium sector has been weak in recent sessions: uranium ETFs in the U.S. are declining because industrial sectors, unlike technology, are not ignoring the negative effects of persistent inflation. An additional factor was JP Morgan’s decision to downgrade the GDR recommendation from “Buy” to “Hold” with a target price of $90. However, the situation does not appear entirely negative — we see that the URA ETF has reached support levels, and similarly, Kazatomprom may test strong support near $72 today. This could become a trigger for a local rebound in the shares. Judging by the KASE opening, the market is already responding with a 1.5% gain despite the fact that the GDRs closed down 1.2% yesterday. At the same time, it is important to note that currency risk has not been fully eliminated — local market quotes are still trading at a 4.2% premium to the GDRs. The situation is the opposite for Kaspi: following yesterday’s close, the shares traded 4.7% below ADS and are rising 2.5% at today’s open, although the technical picture has not changed significantly yet. In addition, Halyk Bank shares are also showing gains today.
Currency. Interesting changes are visible on the USDKZT chart — yesterday the dollar broke above the local downward trend formed in March and may move on to test the medium-term downward trend that has been in place since October 2025 during the coming sessions.