Our comments and expectations
External background. Global markets ended Friday's session calmly. The S&P 500 showed minimal gains after surging a day earlier at the expense of the technology sector. Nvidia shares, which were the leaders of the session before last, rose only 0.35% this time. According to Michael Hartnett of Bank of America, the growth of AI and optimism about economic growth in the context of monetary policy easing are the ingredients of the "magic sauce" that contributes to the growth of stocks. Meanwhile, Goldman Sachs economists have changed their forecast for the Fed and now expect four cuts this year compared with five earlier, with changes in June, July, September and December. In Europe, the Stoxx 600 continued to grow and was able to update the historical highs of January 2022. The DAX closed modestly after Thursday's jump. This morning, we see a decrease in the CSI 300 and Hang Seng indices by 0.5-0.7%. On Friday, 11 Chinese companies immediately lost their credit ratings at Moody's Investors Service amid growing defaults.
Bonds. The yield on 10-year U.S. Treasury bonds showed a decline on Friday to 4.26%. However, this did not significantly change the technical picture. JPMorgan's rate strategists have raised their forecasts for year-end Treasury bond yields. The indicator for 10-year treasuries now stands at 3.80% compared to 3.65% previously.
The KASE index. The index rose 0.9% on Friday. We like the growth structure, as almost all stocks (except Kaztransoil) were in the positive zone. The local market also showed that it will not continue to form a sideways trend below the 4,680 point mark. On the other hand, we are still concerned about the appearance of a downward divergence on the 4-hour chart and the step-by-step proximity to the formation on the daily chart.
Index shares. The largest growth was seen at Kazmunaigas and Kcell. It is worth noting that the upward movement of the shares of the mobile operator remains quite strong – this is what we initially expected from Kazakhtelecom securities, and not from Kcell. On the LSE, Halyk Bank's GDR increased by another 4.1% - the influence of seasonal factors and previous news is felt. However, we want to draw attention to the fact that the securities are approaching the upper limit of the upward growth channel. His test can occur in the range of $18.10 to $18.4. The boundaries of the channel are quite clearly visible, so we believe that they will act as a strong resistance level. Kazatomprom decreased by 2.7% amid lower uranium prices. The URA and URNM industry ETFs look weak, so we think it's better to hold off on buying KZAP shares. It is noteworthy that the decrease in uranium may be a consequence of an increase in the production forecast for 2024 from the British GlobalData. Moreover, the company believes that growth will be provided by Canada, and, interestingly, Kazakhstan, which, in their opinion, will demonstrate the highest growth in uranium production. This contradicts the forecast of the company itself.
Currency. In the foreign exchange market, the picture, contrary to our expectations, remains unchanged. The USDKZT quotes continue to move under the pressure of the 50-day moving average.
Key market news
(=) NBK: What influenced the reduction of the base rate