Our Comments and Expectations
External Background. The S&P 500 showed a nearly neutral result yesterday, halting its growth after the recent "Trump rally." Companies within the index traded in mixed directions, with the most notable declines observed in semiconductor manufacturers' stocks. In economic news, investors were awaiting the U.S. inflation report for the previous month, which did not bring any surprises. The Consumer Price Index (CPI) in the U.S. for October 2024 increased by 0.2% compared to September, and on a year-over-year basis, it grew by 2.6%. Core CPI rose by 0.3%, which also met expectations. A negative aspect of the publication is that the core index has remained at the same level for the third consecutive month, indicating a lack of progress in tackling price increases. However, swap traders increased the probability that the Federal Reserve will reduce rates by 0.25% on December 18, to about 80%. Citigroup believes that the Fed will cut rates by 50 basis points in December following the CPI data release. In Europe, indexes showed volatile trading, fluctuating during the session. However, the final result was neutral. According to the President of the Bundesbank, Joachim Nagel, Trump's trade tariffs could cost Germany 1% of its economic output if implemented. In the morning, Japan and Korea's indexes showed moderate results. The yen fell to 155 against the dollar, which is noted to be positive for U.S. stocks. Oil is trading slightly below $72 per barrel for Brent. Morgan Stanley lowered its 2025 Brent oil price forecast due to the likely oversupply.
Bonds. The yield on 10-year U.S. Treasury bonds reached its highest levels since July. Corporate bonds remained neutral.
KASE Index. KASE closed almost unchanged yesterday. On the daily candle, it can be seen that the index reached 5450 points—a new record— but was unable to sustain this level.
Index Stocks. The large shadow observed on the candle of the index yesterday indicates a weakening of the trend's strength, which we mentioned in the previous review. However, when looking at individual stocks, the main contribution to this price range came from Kcell stocks, which may periodically show such dynamics regardless of background news or the technical picture. A similar price range was seen in the People's Bank stocks, which show signs of slowing growth. This mirrors the dynamics seen before the previous report and resembles the current movement of the S&P 500. On the LSE, Air Astana showed interesting growth, with its stocks rising by 2.3%, slightly breaking above its 50-day moving average. For the GDRs, this level is a strong resistance, and we are waiting for signals for a more confident breakout. People's Bank and Kaspi GDRs dropped by 1.1-1.2% yesterday.
Currency. Verbal interventions only discouraged dollar buyers for one session. Today, the U.S. dollar has risen by 0.3% against the tenge, reaching 493.8. The U.S. dollar index (DXY) has also been rising, now for the fifth consecutive session.