Our comments and expectations
External backdrop. On Wednesday, the S&P 500 rose by 1.6%, the Nasdaq by 1.4%, and the Dow Jones by 3.0%. The market was supported by the results of the U.S. midterm elections and a sharp drop in oil prices. Democrats gaining control of Congress strengthened expectations of curbs on further military escalation around Iran. At the same time, the advance was not uniform: the SOX semiconductor index lost 3.1%, reflecting investors’ ongoing caution toward the sector. European markets also rose: the Stoxx 600 added 1.8%, the DAX 2.2%, and the FTSE 100 1.8%. Brent crude fell 8.7% to $94.62 per barrel. The main trigger was a reassessment of the prospects of a war with Iran after the elections: the market is betting that the weakening of Trump’s political position and Democratic control of Congress will increase the likelihood of a diplomatic settlement and reduce the risk of large-scale escalation. This extended the reduction in the geopolitical premium that began on Monday. Compared with Friday’s close, oil has already lost 16.6%. The yield on 10-year USTs fell by 6 bps to 4.89%, and the DXY index declined by 0.4%. Against this backdrop, gold rose 3.4% to $4 073 per ounce, supported by a weaker dollar and lower yields. The next key reference point for expectations on the Fed rate will be Friday’s U.S. employment report. This morning, performance in Asia remained mixed. Hong Kong and mainland China markets were rising, while South Korean and Taiwanese stocks were under pressure due to selling in chipmakers. S&P 500 index futures are down 0.17% at the moment.
KASE Index. KASE is rising for the second session in a row. The main driver was Kazatomprom, while most other names ended the day lower. Following yesterday’s session, the index returned to Friday’s level; however, at today’s open it is showing a slight decline amid mixed moves in Kaspi and Kazatomprom shares.
Index stocks. Kazatomprom gained 2.8% to 28 980 tenge. The operating report published the day before, showing growth in the group’s production and sales while maintaining annual guidance, can be called a residual trigger, since on the LSE it was no longer a sufficient reason to support the GDRs. Moreover, the London receipts fell 1.6% to $60, while uranium slipped 0.3%. Initially, the quotes rose up to $63.9, but then, under selling pressure, closed at the session lows. Meanwhile, Kaspi on Nasdaq jumped 3.5% at once and began to show more interesting dynamics compared with Kazatomprom. Such a rise allowed the quotes to consolidate noticeably above the 50-day moving average, which again provides technical signals for growth. Among stocks attractive for buying, we can also note Solidcore amid rising gold prices. Yesterday, the price per ounce jumped 3.4% but ran into a descending trend line. We had some doubts about the possibility of a breakout, but this morning the quotes are up another 1.6% and are already giving more confident signals of a recovery. Kcell added 0.5%, and KazTransOil 0.3%. Halyk Bank fell 0.2% despite a 0.9% rise in the receipts. The Ministry of Energy confirmed Kazakhstan’s 2026 oil production plan at 96 million tonnes. This is a retention of the previously reduced target rather than an upgrade to the forecast: the initial expectation was 100.5 million tonnes. For KazMunayGas and KazTransOil, the statement is moderately positive in terms of production and transportation stability amid disruptions to export infrastructure. Nevertheless, it does not imply additional volumes beyond the current plan and does not offset the deterioration in the price environment.
Currency. USDKZT is trading today at 452.5 tenge. The tenge is strengthening, but on the chart the move is insignificant. Moreover, quotes are practically not reacting to either oil, or the dynamics of the DXY dollar index, or the ruble, which has been falling against the dollar for the fourth session in a row.