External Background.
U.S. stock markets ended yesterday's trading session neutrally with slight declines. The Nasdaq index fell by 0.06%, and the S&P 500 by 0.16%. However, the small-cap Russell 2000 index rose by 1%, indicating a continued rotation from large companies to smaller ones. Investors were focused on reports from giants like Alphabet and Tesla, which achieved record revenue in the second quarter and exceeded market expectations. However, the publication of the reports occurred after the market closed, and in post-market trading, Tesla fell by 7.8%, and Alphabet by 2.2%. The European Stoxx 600 index slightly increased by 0.13%, driven by continued growth in the technology sector, which rose by 1.4%. This growth was fueled by a strong report from Germany’s SAP, whose shares increased by 7.2%, which also boosted the German DAX index by 0.8%. Asian markets are showing declines this morning, reaching multi-day lows. The Hang Seng index in Hong Kong is down by 0.6%, while Japan’s Nikkei 225 has dropped by more than 1%. Oil prices fell by another 0.9% yesterday, amid some progress in peaceful conflict resolution in Palestine.
Bonds.
The yield on U.S. 10-year Treasury bonds remained unchanged yesterday, at 4.25%.
KASE Index.
The KASE index fell by 0.5% on Tuesday, continuing to move within a local sideways trend. The drop in the index occurred due to the significant price difference between depository receipts and shares.
Index Stocks.
The biggest losers yesterday were Kazatomprom and Kaspi.kz shares. Both issuers fell following the quotes of their foreign depository receipts, with a significant price gap between them. In the case of Kaspi.kz, the difference remains substantial, with shares trading 5.8% higher than ADRs. Therefore, further decline in the stock is likely today. Despite ADRs showing a decent 5.8% increase at one point yesterday, it was later pushed down. Still, we believe that the scenario of ADR price recovery remains relevant. It was also revealed yesterday that Kazatomprom's shares were repurchased by the Ministry of Finance at a 17% discount to the current price. Additionally, we note the recovery of Kcell and Kazakhtelecom shares by 1% and 0.9%, respectively. Kcell continues its attempts to return to its previous sideways trend but faces resistance at the level of 2,990 tenge. Air Astana announced that it will publish its results for the first half of 2024 on August 5. KazTransOil’s share price fell by 0.6%, nearing its support level. If the stock falls below 805 tenge, we may see an acceleration in the decline.
Currency.
During currency trading yesterday, the dollar briefly fell to 471 tenge, but the last trade price rose slightly to 473.67 tenge. The weighted average price decreased by 33 tiyn. Trading volume has remained relatively high for the third consecutive day.