Our comments and expectations
External background. The S&P 500 showed a moderate trading session yesterday. Quotes decreased with the opening of trading, then they were able to recover some of the losses, which eventually led to a result of -0.1% at the end of the day. The main reason for the lull in the market is the expectation of the publication of US inflation data for February, which will be published today. Market expectations are at 3.1%, which is equal to the previous January figure. A survey conducted by 22V Research shows that 45% of investors expect the market reaction to the consumer price index on Tuesday to be in risk aversion mode. Although most are still betting that the consumer price index is on a favorable path for the Fed to 2%. The share of those who believe that financial conditions need to be tightened has increased from 22% to 36%. Prior to the publication of the main CPI, it became known yesterday that US consumer expectations for inflation over the next three years have increased, increasing even more sharply in the five-year horizon. In Europe, the Stoxx 600 declined slightly, while the DAX and FTSE 100 showed small gains. In the morning, the Hong Kong Hang Seng has been growing in Asian markets, while reaching highs since the beginning of the year. Xiaomi posted the largest intraday gain (+10.6%) in more than a year after it announced that it would start selling its long-awaited electric vehicles this month. Oil remains in a sideways trend, uranium continues to decline slowly.
Bonds. The US 10-year yield slows down after breaking through the 50-day moving average. Corporate bonds showed a neutral movement.
The KASE index. KASE showed an increase of 0.4% yesterday. It was the 6th session in the current continuous growth series. Since January 31, the index has held 28 trading sessions, of which only 3 were negative. Despite the fact that the index had previously broken the downward divergence on the daily chart, it reappeared on the 4-hour chart.
Index shares. Halyk Bank became the growth leader yesterday. On the LSE, the quotes also showed a good result, and, remarkably, they came out of local consolidation. However, for further growth, the securities will have to overcome fairly strong resistance levels, since at the moment the quotes are at the upper limit of the large ascending channel. Kazatomprom lost 3.3%, failing to break through the 50-day moving average. Air Astana also declined on the LSE (-2.6%). From the point of view of the technical picture, AIRA securities on KASE have formed a support level near the 1080 tenge mark. According to Fibonacci levels, support is also close – at around 1078 tenge. After the moderately positive KEGOC report for the 4th quarter, we increased the target share price to 1790 tenge (21% potential) and raised the recommendation to “Buy”. The company continues to show significant revenue growth against the background of reforms in the electric power industry and rising tariffs.
Currency. The dollar bounced up yesterday after reaching the 445 tenge mark. However, the USDKZT quotes have hit the 50-day moving average again and cannot break through it.
Key market news
(=) KCEL: The audit report on the consolidated financial statements of Kcell JSC for 2023 has been published