Our comments and expectations
External background. The S&P 500 showed a fairly brisk growth of 1.7% yesterday. Nasdaq bounced even higher – by 2.4%, amid the leadership of technology sector stocks. The central event was the report on producer prices. The actual report for July was 0.1% (with expectations of 0.2%), which is the lowest growth rate in 4 months. This increased hopes for the Fed's September rate cut and raised hopes that the central inflation report would also be successful today. Swap traders predict a Fed rate cut of about 40 basis points in September and an overall rate cut of more than 105 basis points in 2024. Asset managers in large companies also welcomed the report, expressing the opinion that after its publication, the Fed has no reason not to cut the rate in September. The president of the Federal Reserve, Atlantyrafael Bostik, announced that he needed additional data before supporting the decline. Meanwhile, Goldman Sachs says that financial markets estimate the probability of a recession in the United States at 41%, compared with 29% in April. On the other hand, according to a global BofA survey, last week's volatility did not undermine investors' optimism about the US tech giants or expectations of a soft landing of the economy. Of the individual companies, Starbucks can be noted, whose shares soared by 24.5% after Brian Niccola from Chipotle was named the next leader of the company.In Europe, the leading indexes showed more modest results – the DAX and Stoxx 600 rose by 0.5%, the FTSE 100 by 0.3%. There is a moderate positive trend in Asian markets. Oil has pulled back slightly and is trading at $81 per barrel of Brent in the morning.
Bonds. The US 10-year yield has started a wave of decline again, despite the lack of risk-off sentiment in the market. Corporate bonds rose 0.5%.
The KASE. KASE index has fully recovered after falling last week. Quotes closed yesterday at 5230.6 points, which is only 8 points lower than the close on August 1 (on the eve of the decline). Given the good mood on the US stock exchanges and the growth of depository receipts of our banks, the probability of recovery to 5,260 points increases today.
Index shares. Among the notable moments, we can note the growth of Halyk Bank shares on KASE and LSE. In both cases, local resistance levels were broken through. Perhaps investors are waiting for some information regarding the semi-annual dividends, or a positive financial report, the press conference of which the bank postponed a day earlier - on August 20.Kaspi also looks good, but ADS has a resistance level in the form of a 50-day moving average not far away.
Currency. The dollar is still restrained by the level of 480 tenge. However, we would like to note that a large number of tests of one resistance level often leads to its breakdown. We continue to observe. The ruble fell to 92.9 per dollar in forex today.