Our Comments and Expectations
External Background: The S&P 500 rose by 1.2% and set new historical highs. As we noted earlier, the central event of the day was the release of inflation data, which served as the catalyst for growth. The core inflation rate in the U.S., which excludes food and energy costs, was 0.3% from March, breaking a series of three values that exceeded forecasts, raising concerns about entrenched inflation. According to the Bureau of Labor Statistics, the annual rate fell to its slowest pace in three years. This is a small (but positive for the market) step in the right direction for officials at the Federal Reserve who wish to start lowering interest rates this year. Individual retail sales data indicated some weakening of sustainable consumer demand that supports the economy. In Europe, indices reacted positively to the rise in the U.S. market. Stoxx 600 and DAX rose by 0.6% and 0.8%. In the morning, Asian markets showed an upbeat mood, with Hang Seng moving up by 1.5% and Nikkei 225 by 1.4%. However, Kospi lost some of its earlier gains. Among tracked commodities, gold saw the most significant increase.
Bonds: The inflation data served as a decent trigger for bond growth. The yield on 10-year U.S. government bonds yesterday fell out of the rising channel and broke below the 50-day moving average. Emerging market bonds rose by 1% and may soon retest March highs.
KASE Index: The KASE closed neutrally yesterday and is also showing moderate dynamics today. From a technical perspective, the index's movement resembles the formation of a triangle.
Index Stocks: Trading in individual stocks was slightly more active yesterday compared to the previous session. Kazatomprom led the gains, approaching a test of the resistance level at $43.3 on LSE and 19,200 tenge on KASE. Kaspi decreased by 3.1% without strong background news. The main negative factor here is the drop below its 50-day moving average. BCK rose by 1.2% and is currently hitting a local resistance level at 1,653 tenge; if it breaks above, the stock can be considered for local purchase.
Currency: The dollar is trading below the 442 tenge mark this morning. We are currently observing the dynamics in case of a breakout above 442, which could theoretically open the way to 446 tenge.
Key Market News:
(=) KZTO: Since the beginning of 2024, KazTransOil has transported 420,000 tons of Kazakh oil to Germany.
(=) Economy: The economy of Kazakhstan is expected to grow by 5.5% in 2025 - EBRD forecast.