BUX down again in thin trade

Telco

The Budapest Stock Exchange's main BUX index finished down 0.82% at 16,898.91 Wednesday, the first time under 17,000 since last March, after falling 0.54% Tuesday. It is down 8.97% from the end of last year, after it rose 2.15% in 2013. The BUX fell for a fourth consecutive day, bucking the slowly rising trend in Western markets of the last two days.

The government's tax plans for next year continue to weigh on the market, as new or higher special taxes on internet services and a host of everyday staples from soaps and deodorants to detergents to stationary goods, and to credit card purchases, are likely to further hurt household consumption already weak on slowing employment growth.

The internet tax also risks to open a new front of animosity with the EU. Tuesday, a European Commission spokesperson said the planned internet tax was part of actions limiting freedoms in Hungary. Earlier, the speaker of Hungary's parliament said that if the future of the EU is Brussels "dictating how to behave", Hungary should "think over how to back out of it slowly and cautiously".

In the afternoon, the prime minister's office denied that political risks could delay acceptance of Hungary's EU-funded operative programs in Brussels.

A new survey of Hungary's statistics office out on Wednesday showed overall employment rise slowed in the July-September period from the previous June-August period while unemployment diminished. Analysts added that both improvements were increasingly due to government sponsored fostered workers who earn about two-thirds of the official minimum wage, and to Hungarians working abroad.

The statistics office overall employment survey is an extrapolation based on interviews of people who had income for at least one hour of work with or without work contract in the "given week", that is the week when the sample was taken.

Earlier, the genuine statistics on regular full-time employment with work contract also showed a slowing of growth up to August in the national economy calculated without fostered workers.

The National Bank of Hungary (MNB) prolonged its Lending for Growth  program stimulating lending to small and medium enterprises, but the central bank's head also said the Hungarian economy doesn't have the prerequisites necessary for a sustainable growth rate of above 4%.

OTP lost 1.37% to HUF 3,950 on turnover of HUF 1.89 bln from a HUF 4.66 bln session total, a tad above half the daily average this year.  MOL slid 0.09% to HUF 11,500 on turnover of HUF 937 mln. Magyar Telekom dropped 2.11% to HUF 324, a more than five-month low, on turnover of HUF 406 mln. Richter retreated 0.41% to HUF 3,675 on turnover of HUF 1.31 bln. The bourse's mid-cap BUMIX went out 0.37% lower at 1,439.38.

Elsewhere in the region, Warsaw's WIG20 was down 0.29%, while Prague's PX fell 0.81%. Western Europe's major indices were all up ahead of their close Wednesday, FTSE-100 in London 0.85%, DAX30 in Frankfurt up 0.20%, and CAC40 in Paris 0.02%.

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