Our comments and expectations
External backdrop. The S&P 500 gained 0.3% yesterday, and the Nasdaq also rose 0.3%. As expected, the Fed kept the rate in the 3.75–4% range, improving its assessment of the economy but noting persistently elevated inflation. The pause did not remove expectations of further tightening: investors continue to price in a rate hike in December. The yield on U.S. 10-year Treasuries rose by 5 bps to 5.04%. After the close, attention shifted to tech earnings. Microsoft found support thanks to strong cloud results, while Alphabet’s significant cash outlays once again heightened questions about the payback of AI investments: the stock lost about 10% in the post-market. Today, this is weighing on Asian markets and U.S. futures. European indices were limited to moderate gains the day before: the Stoxx 600 added 0.1% and the DAX 0.4%. Oil rose amid renewed concerns about supply disruptions from the Middle East, though part of the gain is being pared back this morning on hopes of a resumption of negotiations.
KASE Index. KASE rose 0.16% yesterday, although the upside potential could have been greater: during the session, quotes reached almost 7,940 points but then declined, leaving a shadow on the daily candle. It is worth noting that the daily highs roughly corresponded to the upper boundary of the current flag channel. At the same time, the “culprits” behind such a swing in the index were most likely Air Astana and Halyk Bank shares. At today’s open, the index is up 0.4%.
Index stocks. Kazatomprom showed a brisk rise yesterday on both venues. On the LSE, the quotes surged upward out of a falling wedge pattern, which we had forecast in previous reviews. The only negative point was that the quotes ran into the 50-day moving average. Uranium prices rose 1.3%, from $90.15 to $91.3 per pound, the highest since February. A positive trigger for the company was the President’s proposal to consider creating a state strategic uranium reserve sufficient to supply Kazakhstan’s future nuclear power plants for 100 years. In addition, Tokayev indicated the possibility of starting construction of the Balkhash NPP as early as 2027 and instructed to advance the agreement on the “Moiynkum” project. Building the reserve could potentially create additional domestic demand for uranium. However, it should be taken into account that the volumes, timelines, procurement mechanism, and prices have not been disclosed. The initiative strengthens long-term demand prospects rather than providing grounds to immediately revise the profit forecast.
Currency. The dollar did not move above 456 tenge after news of an instruction to provide 1.5 trillion tenge from the National Fund for social projects in the current year and the first two months of 2027. Each of the four months accounts for about $800 mln of sales, and this amount likely comes separately from the monthly transfers from the National Fund. Given that over the past five months the National Bank has been selling $200 mln, in theory one could expect about $1 bln of sales each month up until the onset of the strong tax period in February. This could become another factor restraining dollar growth.