Our Comments and Expectations
External Background
The S&P 500 rose at the opening of trading yesterday but started to decline shortly afterward, closing with a 0.8% loss. The primary reason for the market decline was the weak auction of 10-year government bonds. JPMorgan reported that the probability of the U.S. economy sliding into a recession by the end of this year has increased to 35%, up from 25% at the beginning of last month. Meanwhile, traders are preparing for today's data on initial unemployment claims. In the index map, the semiconductor sector stood out, with Nvidia falling by 5.12% and Broadcom by 5.32%. The energy and utilities sectors were in the green, driven by the rise in oil prices.
European indices performed better than their American counterparts. The Stoxx 600, DAX, and FTSE 100 gained 1.5-1.7%. Asian indices are showing a slight decline this morning. Growth began to slow down yesterday, despite Japan's central bank's soft statements that it would refrain from further rate hikes amid market volatility. Indices in South Korea and Hong Kong are also trading with a slight negative bias. S&P 500 futures are neutral this morning. In the commodity markets, oil showed growth, reaching $78.5 due to increased tensions between Iran and Israel.
Bonds
The yield on U.S. 10-year bonds rose by 2.1% to 3.97% following weak demand at the auction. This week, the market will also see the issuance of 30-year bonds worth $25 billion.
KASE Index
KASE rose by 1.3% yesterday, which is a good result. The resistance level around 5120 points was broken, and the index has about 1% of growth potential to return to the levels seen before the last decline. Judging by the dynamics of Western markets yesterday and Asian markets today, KASE trading may be neutral today.
Index Stocks
Kaspi continued to lead the growth and extended its premium over its ADS by 12.7%. It’s worth noting that Kaspi showed growth on Nasdaq at the beginning of the session, but like the rest of the U.S. market, the stock fell by the session's end, resulting in a neutral outcome. The best performance among GDRs was seen by Halyk Bank, but its 1.8% rise did not affect the stock price, which remains in a sideways trend. Since there were no notable results for the foreign versions of our stocks yesterday, we do not expect them to support KASE today, meaning the current session may pass neutrally.
Currency
There were no significant changes in the USD/KZT chart – the rates remain in a sideways trend below the resistance level of 480 tenge for the dollar.