External Background: U.S. indices moved in different directions yesterday. The S&P 500 remained neutral, although it showed growth at the beginning of the session, the Dow Jones fell below 40,000 points, while NASDAQ was the leader in growth, driven by semiconductor manufacturers in the tech sector. Among the Federal Reserve members, Loretta Mester from the Cleveland Fed noted that the prospects for interest rate cuts are smaller than previously expected. This week, a lot of attention will be on Nvidia's earnings report on Wednesday, May 22, after market close, as well as the release of the Fed's minutes from the last meeting tomorrow. The European mainland indices, Stoxx 600 and DAX, rose by 0.2-0.35%, while the British FTSE 100 closed neutrally. This morning, a notable 2% correction was seen in the Hong Kong Hang Seng index. Recall that at the close of yesterday's session, the monthly rally had brought the index a 21% increase, and the quotes had entered the zone of technical overboughtness. From fundamental news, there was negative sentiment from China's troubled real estate sector—last month, local authorities reported the lowest land sales revenue in eight years, indicating financial difficulties and a lack of improvement in the situation. Against the backdrop of rising prices in commodities such as copper, wheat, and gold, the Bloomberg Commodity Spot Index reached its highest level since January 2023 on Monday.
Bonds: The yield on 10-year U.S. Treasury bonds continues to retest the 50-day moving average. Corporate bond prices changed little.
KASE Index: KASE experienced a lively session yesterday, with all index stocks rising except for Air Astana, and three of them showing an increase of at least 3.6%. It's worth noting that KASE is close to updating its highs, and the previously mentioned triangle formation appears to have broken upwards.
Index Stocks: Halyk Bank closed the session with a 4.1% gain. According to the report, the first quarter of 2024 was once again record-breaking for Halyk Bank in terms of interest income, which grew by 31% year-on-year and 7.1% quarter-on-quarter. Meanwhile, interest expenses increased only slightly, resulting in a 14% quarter-on-quarter rise in net profit, reaching the second-highest quarterly figure in its history at 178 billion tenge. However, the report included other undisclosed expenses that ultimately impacted net non-interest income. It’s also important to mention that the GDRs of Halyk Bank on LSE did not break above the trend line, which serves as the upper boundary of the stock's rising channel. BCC's shares rose by 3.6%, which starts to confirm our assumption of a new local revival in the stocks. Previously, the bank uploaded its first-quarter 2024 report on KASE.
Currency: The 50-day average held back the dollar's growth, which has weakened against the tenge for the second consecutive session and is trading at 441.7.
Key Market News:
(+) AIRA: Air Astana will connect the London Stock Exchange for stock buybacks.
(=) KMGZ: National Company KazMunayGas reported production results for the first quarter of 2024.