External environment. On Friday, the US market posted a calm session, returning from the Christmas holidays and immediately heading into the weekend. Although the decline was minimal, it interrupted a five-session winning streak. Among megacap companies, Nvidia showed the strongest performance, with its shares gaining 1%. Investors are now focused on how the year will end, as there is a well-established pattern of market growth during the last five trading sessions before the New Year and the two sessions following it. According to statistics, this period can often set the tone for the entire year ahead. LPL Financial notes that when the market rises before the New Year, the S&P 500 index gains an average of 1.4% in January and about 10.4% over the following year. European markets were closed. Yesterday, Trump and Zelensky held a meeting after which they announced significant progress toward peace with Russia: the parties reportedly agreed on around 95% of the terms, although the Donbas issue remains unresolved. Against this backdrop, oil prices fell by 2% and returned to the $60 per barrel level. This morning, futures are trading around $60.8. Copper remains one of the major breakout assets of the past six months, having risen by 34% since its late-July drop amid Trump-related sanctions. During the Asian session, most leading indices are showing moderate declines, with the exception of South Korea’s Kospi, which gained 2.2%. S&P 500 futures are currently down 0.1%.
KASE Index. On Friday, the KASE index declined by 0.1%. The recovery following the December 15–17 drop has stalled, which is not surprising near resistance levels. Trading activity continued to decrease, while volumes fell to their lowest level since December 15.
Index stocks. From a technical perspective, the current sideways movement of the index still resembles a flag pattern. However, based on current dynamics, we are now at levels seen on September 2–3, which corresponds to the end of the summer rally and the transition to a sideways trend. On Friday, the largest declines were recorded by the former growth leaders KazTransOil and Air Astana. Although these stocks did not make a significant contribution to the overall market movement, they indirectly signaled the exhaustion of the local market rally. At the same time, stocks such as KEGOC and Kazakhtelecom continued to rise. We note elevated trading volumes in KEGOC shares observed since December 19. Notably, over the past 23 sessions, prices declined in only four of them. At today’s session open, KMG is showing the largest decline. The stock had risen over the previous three sessions in an attempt to break the downtrend that began on November 24; however, today’s weak performance may halt the recovery. The strongest gainer today is Kazatomprom. Recall that during the last trading session on the LSE, its GDRs jumped by 4.6%.
Currency. On Friday, the dollar once again fell below 500 tenge before being bought back up to 505 tenge. If we focus solely on the closing price, the overall dynamics remain in line with our forecasts. We note that the triangle movement scenario still has a chance to play out, provided that the USDKZT rate does not fall below 502.6 tenge today.