Our comments and expectations
External backdrop. After the long weekend, U.S. markets opened the week with broad gains: the Dow Jones set a new record (+0.3%), while a rebound in chipmakers lifted the S&P 500 (+0.7%) and Nasdaq (+1.1%). Semiconductors were the main driver: the sector ETF added about 2%, AMD jumped 6.6%, and Broadcom rose 3.7% on an expanded partnership with Apple. This helped the market recoup last week’s sell-off in chips, although the underlying rotation into non-tech stocks (Dow’s rise) continues. Sentiment was also supported by a weak June jobs report, which pushed expectations for a Fed rate hike out to December. Oil stabilized near $72 per barrel for Brent after OPEC+ raised output for the fifth month in a row—this time by 188 thousand barrels per day starting in August—amid a gradual recovery in vessel transit through the Strait of Hormuz. In Europe, indices closed Friday with moderate gains led by media and travel sectors. This morning, optimism in chips is facing another test. Despite a decent quarterly report, Samsung shares are down about 9% in the morning, and Korea’s Kospi is plunging 8%. A similar situation is seen in Japan’s Nikkei (-2%) and Hong Kong’s Hang Seng (-0.5%). Against this backdrop, Nasdaq- 100 futures are down nearly 2%. Oil rose this morning on reports of Iran’s missile launches at ships in Hormuz, though gains are capped by OPEC+ output increases.
KASE Index. The KASE Index was virtually unchanged ahead of the long weekend. Trading activity was fairly low: only a couple of names moved more than 0.5%. Nevertheless, today we may see upside from Halyk Bank and Kaspi, which are lagging international prices.
Index stocks. KazTransOil shares rose 0.7% and will likely again attempt to break the local resistance level at 1170 tenge. If the breakout is successful, further upside toward 1230- 1240 is possible, where the dividend cut-off took place. Bank stocks also showed quite notable moves on Friday. BCC fell 0.6% and is down nearly 1.6% overall for the previous week. Quotes continue to move within a medium-term sideways range. Halyk Bank GDRs on the LSE rose 1.2% yesterday and may be starting to bounce off the 200-day moving average. At one point yesterday, gains reached 3.6%. If the price moves above $32, there is room to retest the highs over the next few weeks. We also note that Kaspi ADRs on Nasdaq extended their advance for the third session in a row. The discount on KASE now reaches 1.3%, and for Halyk Bank shares 1.8%. Thus, we can expect some upside in these names already today from the market open.
Currency. USDKZT edged slightly lower on Friday and continues to probe local support. The ruble also shows a broadly neutral result, while the RUBKZT cross-rate remains at 6.13.