Our comments and expectations
External background. The S&P 500 jumped 1.1% on Friday. The technology sector stood out especially, as the NASDAQ rose by 1.74%. Meta rose immediately by 20.3%, after a favorable growth forecast and the announcement of the first quarterly dividend payments in the company's history. Shares of companies such as Nvidia, AMD, Amazon and Microsoft also rose along with it. The focus of economic news was the publication of data on the labor market in the United States. Thus, the number of jobs in the non-agricultural sector increased by 353 thousand last month, with expectations of 185 thousand. The unemployment rate remained at 3.7% against the forecast of 3.8%. Hourly wages increased compared to a month earlier, increasing the most since March 2022. Separate data showed that consumer sentiment in the United States jumped sharply. Such strong results immediately not only negated expectations of a recession, but also called into question expectations of a soft landing of the market, in the sense that there may not be a landing, but the economy will continue to grow. Investors did not hesitate for a long time between what to choose – buying stocks based on positive economic data, or selling due to another factor in favor of the hawkish decisions of the Fed, and eventually decided to choose the side of the bulls. As a result, the swap contracts for the March Fed meeting halved the probability of a 0.25% rate cut to about 15%, while the May contract no longer showed a 100% rate cut that had existed for more than a month. In Europe, the indices showed moderately negative results. In Asia, trading takes place in different directions in the morning, but without much volatility: the Japanese market is growing, the Korean market is declining, while the Chinese market remains neutral. Oil has adjusted for 3 consecutive sessions and dropped below the 50-day moving average.
Bonds. The yield on 10-year US government bonds has recouped about half of the losses it has suffered since January 26. On Friday, the indicator jumped by 15 basis points to 4.03%.
The KASE index. The KASE index rose by 1.16% on Friday. Our local forecasts for the reversal and recovery of quotations have come true. At the moment, the index has about 1.3% growth potential to historical highs on January 22.
Index shares. The growth leader on Friday was expected to be Kazatomprom, which was “catching up” with its GDR, which jumped by 10% on the LSE. Kazmunaigas also looked good, despite the fact that during the session the paper showed a drawdown to 10,890 tenge. Today, since the opening of trading, quotations have fallen by 1.2%, however, the securities have a chance to retest historical highs at the level of 12200 tenge, which were delivered relatively recently. The worst result was for Kaztransoil, however, the securities recoup losses with the opening of trading. Trading on the LSE was relatively calm, despite the fact that the People's Bank and Kaspi lost some gains during the Friday session.
Currency. The dollar continues to rise today after breaking through the downward trend line up. The test of the 50-day moving average will begin very soon.
Key market news
(=) AIRA: Air Astana announced the placement amount for its IPO.