Our comments and expectations
External background. The S&P 500 is losing another 0.3%, declining for the fourth consecutive session. NASDAQ has a series of continuous declines that reached five sessions, which is the worst result in a year. The trigger for the decline was stronger labor market data than investors expected. ADP reported that the number of jobs in the US private sector increased by 164,000 last month, the highest since August, even despite a slowdown in wage growth. Weekly jobless claims fell more than expected to 202,000. Next, the focus will be on data on unemployment and the number of jobs created in the non-agricultural sector. According to forecasts, their number increased by 175,000 in December, and the unemployment rate, according to economists surveyed by Bloomberg, rose slightly to 3.8%. The probability of a March rate cut dropped to about 64% from 70% a day earlier. In Europe, the main indexes showed growth. The Stoxx 600 gained 0.7%, while the DAX and UKX gained 0.5% each. German inflation accelerated to 3.8% year-on-year in December, which is less than expected. Consumer prices in France increased by 4.1%. Quotations on Asian stock exchanges show mixed dynamics. Oil is trading at $80 per barrel after news of an increase in stocks in Cushing. Morgan Stanley joined UBS and Goldman in reducing its forecast for Brent crude for 2024 to $80, as oil supplies from non-OPEC countries will outpace global demand.
Bonds. The yield on 10-year US government bonds jumped to a round mark of 4% after the data on the labor market. The quotes began to break through the downward trend again.
The KASE index. KASE increased by 0.9% yesterday, thereby continuing the implementation of the exit from local consolidation. Today, the index is already reaching new historical highs.
Index shares. Kazakhtelecom and BCC became the engine of the index growth yesterday. In the last review, we made a remark that CCBN quotes hint at a new wave of growth and this hint was further implemented. The shares rose 5.7% yesterday and continue to rise 3.2% today. The current local target may well be the previous highs in the area of 1180-1200 tenge. Kazakhtelecom grew by 4.7%, also realizing hints of growth. Trading volumes turned out to be relatively high again. The market is currently waiting for any news about the potential sale of Kcell, although we believe that the final announcement of the sale is still far away. Meanwhile, the Kaspi GDR on the LSE rose 3.6% from the 50-day moving average. If the pace continues, we expect a retest of the $102 levels.
Currency. On the USDKZT chart, there is a struggle to break through resistance levels. The dollar has already attacked and even slightly punched up the downward trend line against the tenge 2 times, but the national currency still continues to hold positions. In the morning, the dollar is trading at 453.4 tenge.
Key market news
(=) Oil: CPC pumped record volume of oil in 2023