Our Comments and Expectations
Global Background.
The S&P 500 rose by 0.5% after two sessions of 0.6–0.7% declines. Market sentiment was driven by a secondary labor market report ahead of the key release on Friday: U.S. JOLTS job openings in July fell more than expected, to 7.18 million — the lowest in the past 10 months. According to MBA, mortgage applications declined by 1.2% last week. These figures pushed traders to almost fully price in a Fed rate cut in September and to project at least two cuts in 2025. Fed Governor Christopher Waller said the regulator should start lowering rates in September and continue in the coming months, while Bostic reaffirmed the case for just one cut this year. Meanwhile, the Fed’s Beige Book reported “slight or no changes” in U.S. economic activity in recent weeks. In Europe, indices gained 0.5–0.7% as well, but following a deeper correction compared to the S&P 500. This morning, China’s CSI 300 index fell: according to Bloomberg, Chinese authorities are considering measures to curb stock market speculation amid overheating concerns, which has had negative effects before. Oil dropped 2.2% yesterday after Reuters reported that OPEC+ may consider another round of output increases at Sunday’s meeting.
Bonds.
The yield on 10-year U.S. Treasuries fell to 4.21% yesterday. According to a JP Morgan client survey, last week saw one of the largest weekly shifts toward “bearish” positions in Treasuries over the past five years.
KASE Index.
The KASE index gained another 1% yesterday. Overall, the picture has hardly changed, with Kazatomprom joining the list of advancing stocks.
Equities.
BCC shares added another 6.1%, delivering an outstanding +62% monthly performance, with a market cap of $1.94 billion. This time, Kazatomprom shares also provided support (+1%), though the move was neutral in nature and did not trigger a technical breakout on KASE — quotes continue consolidating below the 25,000 tenge level. On the LSE, shares rose 0.7%. On the local market, the biggest loser was Kaspi (-1.1%), which is not critical, while on the LSE, Halyk Bank was hit the hardest: its GDRs broke out of local consolidation and dropped to the $25 support level. This morning, the trend remains: BCC is up 3.5%, while other stocks show moderate moves.
Currency.
As the dollar approaches the upper boundary of the “flag” pattern, its growth against the tenge is slowing. This increases the likelihood of a downward rebound but does not fully rule out further strengthening of the U.S. currency. Key levels should be closely monitored.