Our Comments and Expectations
External Background.
Yesterday, the US stock market was closed due to the Thanksgiving holiday. European indices showed a good rise: the pan-European Stoxx 600 increased by 0.46%, breaking a three-day decline streak, and the German DAX added 0.9%. The main contributors to the growth of these indices were technology companies, which reacted positively to news that the US is considering measures to sell semiconductor equipment and memory chips for AI to China, which would not exceed the stricter limits that had been previously discussed. Futures on the S&P 500 index are up by 0.32% today. In Asian markets this morning, there was mixed dynamics. A decline was observed in South Korea, where the local Kospi fell by 1.4% after the country’s central bank unexpectedly cut the base rate for the second consecutive time to 3% amid a worsening economic growth forecast. The Hong Kong Hang Seng rose by 0.6%, while the mainland CSI 300 jumped by 2.1% after Chinese officials held a meeting aimed at stimulating consumption.
Bonds.
In Asian trading, the yield on 10-year US Treasury bonds continued to decrease, reaching 4.23%.
KASE Index.
The KASE index showed growth yesterday, despite the fact that the currency market was still under volatile conditions.
Index Stocks.
The biggest growth was seen in KMG. The weakening of the tenge opens up opportunities for growth among local commodity exporters, but the 1.6% rise in KMGZ shares was the only notable reaction to currency changes. Nevertheless, the growth seems to be confident: the quotes have risen for the fourth consecutive session, reaching levels from October 11. It should be noted that the last wave of decline began on September 6, and since then KMG shares have lost nearly 7%. Over the last 4 sessions, the quotes have increased by 5.6%. BCC has recouped some of the losses, but now the question arises: has the current growth wave ended, or will the dynamics shift into a sideways trend, as is often the case with these stocks? Another dollar exporter, Kazatomprom, increased by 0.5% yesterday, but this did not change its technical picture. On the LSE, quotes remained unchanged. A positive note is that the quotes remain above the 50-day moving average and are in an upward local trend. However, for the growth to continue, it is crucial for the stocks to break through the $41 level.
Currency.
Yesterday, the USDKZT exchange rate on the forex market reached 519 tenge, but closed at 511.7. The National Bank announced that it is conducting interventions in the currency market, which we believe is a completely justified action. The dynamics of the dollar exchange rate meet the main conditions for such interventions: the rapid weakening of the tenge and the presence of non-economic factors, such as sanctions against several Russian banks, which caused panic sales of the ruble and affected the situation in Kazakhstan. It is worth noting that after the introduction of support measures for the ruble by the Central Bank of Russia, it started strengthening, which we are also observing today in relation to the tenge. Additionally, the National Bank announced an increase in the base rate by 1% to 15.25%, which can be considered one of the two main negative consequences of the current weakening.