Our comments and expectations
External backdrop. Strong macro data on Wednesday worked against the market: the S&P 500 lost 0.75%, the Nasdaq fell 1.1%, snapping a four-day winning streak, and the Dow slipped 0.7%. The US composite PMI in September rose to its highest level since 2021 and clearly exceeded forecasts, while price components climbed to multi-year peaks. This strengthened expectations of further Fed rate hikes. Against this backdrop, and after a weak Treasury auction, the 10-year yield rose to its highest level since 2007 (5.13%). The decline was broad-based, with small caps underperforming. Oil rebounded by nearly 4%, and Brent returned above $103 amid uncertainty around US-Iran talks: in response to Trump’s threats, Tehran said it would never surrender. In Europe, the Stoxx 600 lost about 0.4%, and the DAX fell roughly 0.7%. Strong eurozone PMI data and the pass-through of expensive energy into prices reinforced expectations of an ECB rate hike; government bond yields hit multi-year highs, while insurers, banks, and automakers came under pressure. Today’s focus is the start of Xi Jinping’s visit to the US. The day before, Bessent confirmed the extension of the trade truce with China by two months. Asian markets are mixed this morning: Japan’s Nikkei is rising after an extended holiday, Chinese indices are falling, and South Korean markets are closed. US index futures are trading slightly lower, while Brent is retreating toward $102.
KASE Index. KASE fell 0.3% yesterday, giving back all of the week’s early gains. The main pressure came from dual-listed names, which lost more than 1%, in part due to the stronger tenge, and will likely continue to weigh on the index today as well, given the decline in their receipts yesterday evening. The KASE Index will most likely fall toward local trend support.
Index stocks. Kazatomprom shares fell 1.8% yesterday amid USDKZT moving down to 444 for the first time since June 2024 and a 0.7% drop in the GDRs on the LSE. The premium in the share price remains at 2.4%. In addition, uranium stocks fell 4% in the US, which will likely pressure GDR quotes today. Kaspi.kz shows an even larger price gap between exchanges. The ADS fell 2.7% yesterday, and the premium in the shares is now nearly 5%. We expect the KASE tenge price to decline today. The ADS have approached medium-term trend support and may bounce off it. Price action in the coming days will be decisive. On the positive side, we note KazTransOil shares, which rose 2.3% and, after several attempts, finally moved above the round level of 1,300 tenge. At one point the price climbed to 1,375 tenge, and we again saw an aggressive battle between buyers and sellers, with sellers taking the upper hand once more. We continue to expect further growth in the closing price toward 1,370 tenge.
Currency. USDKZT fell by almost 3 tenge yesterday to 444, a new local low. The pair moved below the Fibonacci level and may slip toward 439–440 tenge. Trading volumes were the highest in the past 14 days.