Our Commentary and Expectations
External Background. The S&P 500 closed flat yesterday, but the session saw a rollercoaster of moves: declines in the first half were followed by a recovery in the second half. Despite the modest gains, the session ended positively, marking a five-day winning streak — the longest since November. Investors are now awaiting major earnings reports from Meta and Amazon, U.S. Non-Farm Payrolls data, and inflation figures, making this a crucial week for market insights.
Yesterday, Scott Bessent told CNBC that the U.S. has sidelined China for now, pursuing trade agreements with 15–17 other countries while also stating that Beijing should take the first step toward de-escalation. Bloomberg modeled the impact of a 22% average tariff rate and now expects a 7% decline in net profit instead of the previously forecasted 12% growth. Morgan Stanley believes a weak dollar will support U.S. corporate earnings. Meanwhile, JPMorgan Chase & Co.'s trading desk has turned tactically optimistic on U.S. stocks, expecting support from strong tech earnings and progress on trade deals. In Europe, leading indices also posted modest gains: the Stoxx 600 has now added 11.3% from its April 9 low. Today, futures point to a slight increase of 0.1% for the Stoxx 600 and 0.3% for the DAX. The trend is similar in Asia: the Nikkei 225 and Kospi are up 0.4–0.5%, reaching their highest levels since April 1, while the Hang Seng in Hong Kong is consolidating for a fourth consecutive session. Traders are hoping China will soften the impact of auto tariffs. Oil declined yesterday and is down another 0.7% this morning, trading near $64 per barrel.
Bonds. The yield on 10-year U.S. Treasuries is declining to its lowest level since April 8. Corporate bonds were neutral.
KASE Index. Yesterday, the KASE Index showed a modest gain of 0.2%. During the session, it approached the psychological level of 5700 points. Most index components saw gains followed by partial pullbacks.
Index Stocks. High intraday volatility was observed in shares of Air Astana, Bank CenterCredit, Kcell, KMG, and Kaspi. Notably, the dynamics of KazMunayGas and Kaspi suggest a potential for local growth. The largest increase was recorded by Halyk Bank, which approached its early-April highs. However, as previously mentioned, large-scale dividend-related sell-offs may begin as soon as tomorrow, potentially affecting the entire KASE Index and lasting up to two weeks. Kazakhtelecom faced resistance at 51,000 tenge, while Kazatomprom met resistance around 17,500 tenge. On the LSE and Nasdaq, Halyk Bank and Kaspi.kz both declined by 1.6%.
Currency. The tenge is strengthening for the third consecutive session against the dollar. This morning, the U.S. currency found support around 512 tenge, but since it's still early in the session, the final closing rate could be slightly lower. EURKZT is consolidating around 584 tenge.