Our Comments and Expectations
External background. The S&P 500 rose by 1.1% yesterday. Most sectors of the index gained, except for the energy sector, which weakened due to falling oil prices, and the utilities sector, traditionally considered defensive.
Commerce Secretary Howard Lutnick hinted at a possible tariff compromise, suggesting that some tariff exemptions for Canada and Mexico might be under consideration.
ADP data showed that private employers added fewer jobs than expected in February — 77,000 versus the forecasted 140,000.
The U.S. ISM Services PMI unexpectedly rose to 53.5 in February from 52.8 in January, exceeding market expectations of 52.6.
Among geopolitical news, former President Trump stated that Zelensky expressed readiness for negotiations on ending the war and mineral supply deals.
In Europe, the Stoxx 600 rose by 0.9%, but the main focus was on the German market. The DAX surged by 3.4%, while Germany's 10-year government bonds experienced their worst day since 1990. The trigger was ambitious plans for fiscal policy reform, including a sharp increase in government spending, particularly for defense.
This morning, Asian markets are showing strong growth: Hong Kong's Hang Seng is up 2.6%, continuing its rally for the second session in a row following the National People's Congress meeting in China. At the meeting, a GDP growth target of 5% for 2025 and a 7.5% increase in defense spending were announced.
Japanese and Korean indices are also rising, gaining around 0.7–0.8%. Oil prices have dropped below $70 per barrel.
Bonds. The sell-off in German bonds triggered a chain reaction, affecting U.S. and Japanese bonds as well. Currently, the yield on U.S. 10-year Treasuries stands at 4.32%.
KASE Index. The KASE index rose by 0.3%, gradually overcoming local resistance levels. This slow upward trend is likely to continue, supported by dividend expectations.
Index Stocks. Yesterday's growth leader was Kazatomprom, which has started signaling a potential recovery. Its GDRs also led among Kazakhstani securities on foreign markets, jumping 3.4%. During the session, prices reached $37.2, approaching the 50-day moving average, confirming its technical importance.
The biggest decline was observed in Air Astana shares. The negative news background was driven by reports that the Agency for Protection and Development of Competition (AZRK) found signs of illegal overpricing of air tickets.
BCC's rally has slowed, while KMG and Kazakhtelecom continue to show steady, albeit modest, growth.
Kaspi declined by 1.1% on the local market; however, its shares remained stable on Nasdaq.
We have updated our dividend forecasts based on 9-month 2024 data — you can find them on page 3 of the review. These forecasts may be adjusted as Q4 reports and Board of Directors' recommendations are released.
Currency. The U.S. dollar is declining to 495 KZT this morning, increasing the likelihood of a scenario where the exchange rate could drop to the next Fibonacci level of 485–486 KZT.