Our comments and expectations
External background. The text is generally good, but there are a few minor inaccuracies and stylistic points that can be improved for greater smoothness and clarity. Here is the corrected version:The S&P 500 closed neutrally yesterday amid rising government bond yields. The focus was on economic data: retail sales in the United States exceeded forecasts across the board, indicating the sustainability of consumer demand. The leading indicator increased by 0.4% in September, while the base indicator increased by 0.7%. The number of applications for unemployment benefits unexpectedly dropped to 241,000. Industrial production fell 0.3% in September, which turned out to be worse than expected, mainly due to the Boeing strike and two hurricanes. Expectations of an interest rate cut in swap contracts decreased to 42 basis points at the next two Fed meetings. Of the individual companies, Netflix can be noted, which grew by 5.1% in the postmarket after attracting more than 5 million new customers last quarter and surpassed Wall Street expectations in all major indicators. The leading European indices rose by 0.8-1.2%. The European Central Bank (ECB) cut its key rate by 25 basis points to 3.25%, as predicted. Officials expect another rate cut in December, and inflation, in their opinion, will settle at 2% faster than previously expected. In Asia, the Chinese market has been growing since morning: the mainland CSI 300 added 3.6%, and the Hong Kong Hang Seng – 3.2%. It is reported that China's economic growth exceeded forecasts and amounted to 4.6% compared to the previous year, against the expected 4.5%. Industrial production and retail sales also exceeded forecasts year-on-year. Oil is rising slightly in the morning, which was the first positive movement in the last five unsuccessful sessions. Gold has been supported by strong data from the United States and is trading at historic highs.
Bonds. The yield on 10-year US bonds is rising after a local decline. Emerging market bonds have suffered.
The KASE index. The KASE index showed a noticeable increase yesterday. We see that the quotes have broken through the local downward trend line. Nevertheless, at the opening of trading on Friday, the market shows a commensurate pullback and increased volatility in KazMunaiGas shares.
Index shares. As expected, Kazatomprom shares showed the greatest growth yesterday. However, the uranium sector and the GDR on the LSE could not continue to grow at the same pace against the background of neutral S&P 500 results. Shares of Halyk Bank rose 1.5% on the LSE, touching the resistance level at $18, which is a locally strong deterrent level. Kaspi on Nasdaq declined, remaining within the current consolidation.
Currency. The dollar declined against the tenge yesterday and continues to weaken this morning. The quotes of USD/KZT dropped to 485 tenge. It is noteworthy that the dollar index DXY has been growing over the past five sessions and began to decline only today.