Our Comments and Expectations
External Background: The S&P 500 unexpectedly fell by 1.1% on Friday. Investors, who were expecting a calm pre-New Year session with low trading volumes, faced a sell-off in the tech sector. According to EPFR data, during the week ending December 25, market players withdrew a record amount of funds from cryptocurrency-related funds. Tech-sector-related funds recorded the longest outflow streak since the beginning of 2023. This may be linked to a shift away from risk due to the high expectations set for the tech sector in 2025, especially considering the significant growth of these companies in 2024. Bloomberg Intelligence's recent analysis showed that analysts are still forecasting a nearly 30% increase in sector profits next year, which increases the likelihood of losses if these projections fail to materialize. In Europe, the leading indices rose by 0.2–1%. Asian markets saw quiet trading this morning, with no changes of more than 1%. Inflation in Tokyo accelerated in December, raising the likelihood of an interest rate hike in the coming months. The South Korean parliament unanimously voted for the impeachment of acting president Han Duck-soo, with all 192 members in favor. Oil traded this morning near the upper boundary of its triangle at $73.8 per barrel. According to Kpler, U.S. crude oil exports to China have nearly halved this year to 81.9 million barrels. This has dropped China to sixth place among the largest oil buyers, whereas last year it held second place.
Bonds: The yield on U.S. 10-year government bonds rose by 0.9% and reached multi-month highs. Bloomberg reports that corporate bond spreads (the difference between the yield on corporate bonds and government bonds) have narrowed to the tightest level since the global financial crisis.
KASE Index: KASE had a good session on Friday. Most stocks showed growth, with many rising by more than 1%. The chart suggests that the index is now moving toward active actions rather than just signaling a local recovery. However, it will be interesting to see how the market reacts to the decline of the S&P 500—whether a correlation between the local market and the Western benchmark will appear.
Index Stocks: Halyk Bank reached levels from December 5, fully recovering its positions. The BCC is currently showing signs of a new growth wave, while Kazatomprom is showing signs of recovery. The leader in growth in the last session was Kazakhtelecom, although this did not provide any new signals for further upside. On the LSE, the leader was Halyk Bank's GDRs. After a 3.8% rise, the quotes are again testing a strong resistance level at $19.5. Air Astana GDRs rose by 3.3%, exceeding their 50-day moving average.
Currency: The dollar began retesting the 525 tenge level after Saturday's ruble weakening on the USDRUB chart. Markets in Russia will be closed until January 9, which may have contributed to the ruble's weakening due to traders' precautions ahead of the extended holidays.