External background. The S&P 500 quotes opened lower on Friday, but then were able to end the session in neutral positions. There were not many bright events in the US market itself, with the exception of data from the University of Michigan, which unexpectedly showed a decline in consumer sentiment to a seven-month low, as high prices continued to affect personal finances. The president of the Federal Reserve Bank of Cleveland, Loretta Mester, said that she still believes that inflation risks are inclined to increase, despite the encouraging news in the latest data. The overall import price index fell by 0.4%, which is a more significant decrease than expected. Nevertheless, the main attention of traders was turned to Europe, where political risks in France escalated. Recall that the dissolution of the lower house of parliament by Macron and the appointment of early elections for June 30 caused chaos and division among the opposition, attempts to create new coalitions amid widespread disagreements. The leading French CAC 40 stock index fell by 4.6% in two trading sessions. French Finance Minister Bruno Le Maire has warned that a victory for the center-left coalition of the New Popular Front could lead to France's withdrawal from the EU. However, the chances of this are still low. According to people familiar with the situation, ECB representatives see no reason to worry about market turbulence. The Stoxx 600 dropped below the 50-day average after a 1% decline, and the DAX lost 1.44% on Friday. In the Asian markets, the influence of France has been felt in the morning, the Japanese Nikkei 225 falls by 1.8%, the Korean Kospi by 0.6%. Hong Kong's Hang Seng is neutral as it tests support for the 50-day average. Gold has grown out of commodities as a protective asset. S&P 500 futures are neutral.
Bonds. The US 10-year yield continued to decline on Friday, but the rate of decline began to slow down. Corporate bonds declined slightly.
The KASE index. KASE lost half a percent on Friday. It was another neutral session, moreover, with a reduced trading volume, which did not bring much change to the market.
Index shares. The largest decrease was seen in shares of Kcell, Kazatomprom and Kazakhtelecom. In the case of Kcell, the correction did not affect the quotes in any way, when both Kazatomprom and Kazakhtelecom rather restrained the potential growth that the papers could show. The largest growth was for the BCC, and the shares still show local hints of the possibility of growth to 1900 or even to the round mark of 2000 tenge. On the LSE and NYSE, the quotes of Halyk Bank and Kaspi declined. HSBK approached the lower boundary of the sideways trend, and Kaspi slowed down in growth, not breaking the $130 mark.
Currency. In the morning, the dollar continues to grow against the tenge to 453.4. Apparently, the strengthening of the tenge on June 12-13 was a pause before the continued growth of USDKZT quotes. Recall that our local target price is at around 455.
Key market news
(+) Inflation: In May, inflation was 8.5%
(=) KZTO: KazTransOil JSC paid dividends on common shares KZ1C00000744 (KZTO) for 2023