BUX corrects up after two days of losses
The Budapest Stock Exchange's main BUX index finished up 0.24% at 17,913.11 Tuesday, after dropping 1.18% Monday. It is up 7.69% from year-end, after losing 10.40% last year. After initial falls, the Budapest parquet attempted to revisit last week's near five-month highs later in the day, but the correction flattened towards close.
After eurozone finance ministers have given Greece until Friday to think over its position in crisis talks on its debt, mixed European markets did not help much, but the fast strengthening Russian rouble on oil's recent rally supported some Hungarian blue chips with high exposure to Russian markets, including Richter and OTP, until the rouble lost the day's gains by late afternoon as the two-day ceasefire in Ukraine appeared to collapse.
Financial services Wood & Co. have initiated coverage of OTP with a "buy" recommendation and a target price at HUF 5,216. From among banks and brokerages rating OPT, presently 8 have a "buy" recommendation, with 6 recommending "hold" and two recommending "sell".
The highly publicised visit to Budapest of Russian president Vladimir Putin to discuss gas supplies to the region did not influence trade directly as his joint news conference with Hungarian prime minister Viktor Orban was scheduled to begin after market close.
Also supportive, a communication from Hungary's National Economy Ministry said it had no intention to intervene in market prices because inflation is expected to remain low for the whole year. Earlier, the chief whip of the governing FIDESZ party demanded that the ministry look into the reasons why lower fuel prices failed to drive other prices down.
The ministry told MTI that businesses still recovering from the drop in demand during the crisis were probably using the lower fuel prices to improve their profitability.
Meanwhile, investors were gearing up to a press conference Wednesday morning of the central bank on how the bank intends to expand its Funding for Growth Scheme for SMEs to include large firms as well.
An economic indicator of ING Bank projects further rise in Hungary’s economic output on top of fast growth last year. LeadING HUBE shows that Hungary’s private sector will remain on an ascending path by the end of the year, and there will be question marks only later. The ING forecast is outstanding as present market consensus sees economic growth in Hungary slowing considerably this year. LeadING HUBE, which projects developments on a 10-month horizon, hit 7.48% year-on-year in February which is a four-year high.
OTP lost 0.74% to HUF 4,293 on turnover of HUF 4.78 bln from a HUF 6.37 bln session total, a quarter short of the daily average this year.
MOL gained 0,64% to HUF 11,800 on turnover of HUF 736 mln.
Magyar Telekom rose 0.54% to HUF 374 on turnover of HUF 349 mln.
Richter advanced 0.80% to HUF 3,780 on turnover of HUF 214 mln.
The bourse's mid-cap BUMIX went out 0.67% higher at 1,506.60.
Elsewhere in the region, the WIG 20 in Warsaw was down 0.01%, while Prague's PX sank 1.01%. Western Europe's major indices were mixed ahead of their close Tuesday, FTSE-100 in London up 0.36%, DAX30 in Frankfurt down 0.57%, and CAC40 in Paris down 0.27%.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.