Our Comments and Expectations
External backdrop. The U.S. technology sector came under significant pressure yesterday. The Nasdaq Index fell 2.2%, while the widely followed iShares PHLX Semiconductor ETF (SOXX) dropped 7.9%. The VIX volatility index jumped to 19.48 points.
While the S&P 500 declined by 1.4%, the industrial-focused Dow Jones Industrial Average slipped only 0.1%.
Notably, no new catalysts emerged to justify the selloff in technology stocks. According to Bloomberg, market observers attribute the decline to forced liquidations and a wave of selling in leveraged exchange-traded funds.
Meanwhile, the U.S. Senate voted to end the war with Iran, although the practical implications of the decision remain unclear given that the parties have already reached a temporary peace agreement.
Brent crude fell below $77 per barrel as tanker traffic through the Strait of Hormuz continued to recover. Data show that between 21 and 25 tankers have been passing through the strait daily over the past three days.
According to the International Energy Agency (IEA), UAE oil exports in early June recovered to nearly 85% of their pre-war levels.
At the same time, U.S. business activity expanded at the fastest pace in five months, supported by a sharp increase in demand for industrial goods.
Scott Bessent expressed confidence in Kevin Warsh, stating that the Federal Reserve Chair would be able to effectively balance both inflation and economic growth.
In Europe, major continental indices declined by 0.7–1.0%, although eurozone business activity contracted less than expected in June.
Asian markets are showing mixed but generally positive sentiment this morning. South Korea’s Kospi is up 3.2%, while Japan’s Nikkei 225 is down 0.9%.
Brent crude is trading at $76.2 per barrel, while S&P 500 futures are up 0.1%.
KASE Index. The KASE Index is showing neutral performance at today’s market open despite the negative external backdrop, which has affected Kazakh stocks trading on foreign exchanges.
Index constituents. Kazatomprom recorded the largest decline on the local market yesterday, falling 2.4%.
Today, however, the stock is rebounding with a gain of 1.3%, despite its GDRs having declined by 2.5%.
It is worth noting that at yesterday’s close across all exchanges, the price differential between local shares and GDRs stood at only +1.7% in favor of local shares, which is not considered significant.
Kazatomprom’s GDRs experienced substantial intraday volatility on the London Stock Exchange but attracted buying interest whenever prices approached support at the 200-day moving average.
A similar pattern was observed in Halyk Bank’s GDRs. The securities fell 2.6%, but the daily chart shows strong buying activity near the 200-day moving average at $29.7.
In this case, the price premium of local shares over GDRs was somewhat higher, with local shares closing 2.4% above their GDR equivalent.
Kaspi’s ADSs posted a more moderate decline, but here too prices continue to be supported by key technical support levels.
We believe that the proximity of all three stocks to their respective 200-day moving averages could provide a solid foundation for future gains should the external environment improve.
Under a more conservative scenario, we expect these securities to maintain their current positions and continue trading within a local sideways range.
Currency. There have been no significant changes in the USD/KZT exchange rate.
However, the Russian ruble has continued to weaken against the U.S. dollar, reaching RUB 75 per dollar. As a result, the tenge has strengthened against the ruble to 6.51.