Our Comments and Expectations
External Background. Over the past two trading sessions, global markets have shown a moderately positive performance overall. The S&P 500 rose by 0.5%, posting most of its gains on Thursday and closing flat on Friday. The index stalled just below the 5700-point mark as investors awaited the start of U.S.-China negotiations, which began on Saturday and have already yielded results. At the time of writing, S&P 500 futures are up 1.5%. Both countries reported “substantial progress” after two days of talks in Switzerland aimed at de-escalating the trade war. According to Chinese Vice Premier He Lifeng, this marks “an important first step” toward resolving disputes. No detailed action plan has been disclosed yet, but the two sides have agreed to establish a mechanism for further talks led by U.S. Treasury Secretary Scott Bessent and He Lifeng.
In Europe, indices posted slightly stronger weekend gains than the U.S. Futures currently show a 0.7% rise in the Stoxx 600 and a 1% increase in the DAX. In Asia, markets also opened on a positive note: the Hang Seng jumped 2% and reached levels last seen on April 2, while mainland China’s CSI 300 rose 1.1%. This improved sentiment is weighing on gold, which is down 1.9% this morning to $3,280 per ounce. Additionally, tensions between India and Pakistan appear to be easing after both sides agreed to an immediate ceasefire following four days of clashes. Meanwhile, Donald Trump is pushing for a meeting between Russia and Ukraine later this week. Oil prices are also rising, approaching $66 per barrel.
Bonds. The yield on 10-year U.S. Treasuries rose to 4.38% on Friday and is currently at 4.43% amid increased risk appetite.
KASE Index. The KASE Index had a solid session on Thursday, gaining 0.6%. Quotes are now above the 5700-point level, though we have yet to see clear signs of a breakout and consolidation. Nevertheless, positive investor sentiment in global markets could serve as a catalyst for further gains in KASE.
Index Stocks. The top performer on Thursday was Kazatomprom. Since April 23, the stock has entered a growth wave that we had anticipated for some time. It has gained nearly 15% so far and could continue to rise, as uranium prices have surpassed $70 per pound for the first time since February. The next resistance level is around 19,000 KZT. We believe today’s sessions on the LSE and Nasdaq may lift GDRs and ADSs, which could positively impact the local shares tomorrow. On the downside, Kazakhtelecom (KZTK) fell by 4.7% on Thursday and continued to drop another 2.3% at this morning’s open. It appears that some investors are locking in profits from the pre-dividend rally without waiting for the dividend payout itself. This may be due to the fact that the dividend amount has already been priced in, and shares could decline by a similar or even greater amount after the record date.
Currency. The U.S. dollar is weakening against the tenge today, trading at 513.9 KZT, likely due to rising oil prices. On the other hand, the dollar is strengthening globally on the back of progress in U.S.-China trade negotiations.