Fitch assessed the impact of the purchase of Hepsiburada on Kaspi ratings

Our Comments and Expectations

External Background. Trading on the S&P 500 started in negative territory, but the index managed to rise and close with a result of +0.2%. The main positive movement was observed in the technology sector, especially among semiconductor manufacturers. In such market conditions, the Nasdaq 100 index reached a new historical high. Google was at the center of corporate earnings reports, with its shares rising 5.9% in after-hours trading. The company reported strong results for the third quarter of 2024, exceeding expectations in both revenue and profit. Revenue reached $88.27 billion, above the forecast of $86.3 billion. Earnings per share (EPS) also surpassed expectations, amounting to $2.12 compared to the projected $1.85. After a 4% rise during the main session, AMD shares fell 7.6% after trading closed. It was noted that the chip manufacturer gave a weak forecast for the fourth quarter, with investors disappointed by a 68% drop in sales in the gaming sector and a decline in revenue from embedded systems. In economic news: investors saw an unexpected decrease in U.S. job openings to 7.4%, the lowest level in the last 3.5 years. These figures contradict the September employment report, which indicated a still-strong labor market. Meanwhile, the U.S. consumer confidence index from the Conference Board for October jumped to a yearly high of 108.7 points, with expectations at 99.5. In Europe, indices showed a slight decline. In Asia this morning, stock prices fell in Hong Kong and Seoul, but rose in Japan. Brent oil prices dropped to $71 per barrel.

Bonds. The yield on 10-year U.S. bonds showed growth yesterday but ultimately closed neutral.

KASE Index. Yesterday, the KASE showed a generally moderately positive session. Stocks did not show significant growth, and declines in individual securities were only minor.

Index Stocks. The biggest growth yesterday was demonstrated by Kaspi.kz shares. On the Nasdaq, prices fell by 2.3% and maintain a neutral trend for now. Yesterday, Fitch Ratings stated that the acquisition of Hepsiburada would not affect the company’s ratings: “Kaspi.kz’s very high cash generation capacity and Hepsiburada’s limited debt mean that the deal will not have a significant impact on Kaspi.kz’s capitalization and leverage.” Meanwhile, Kcell is slowly but steadily updating historical highs. Kazatomprom shares on the LSE rose by 2.6%, improving the technical picture and once again exceeding resistance levels.

Currency. Yesterday, the dollar’s growth was halted around 492.8 tenge. Today, the tenge gained ground, strengthening to 487.5. National Bank representative Timur Suleimenov stated that large transfers from the National Oil Fund are “an inflationary factor that prevents a faster easing of policy.”