Mood continued to be subdued on a day when Hungary’s parliament was to adopt next year’s budget with more burdens increasing than decreasing, on balance, for selected company sectors and the general public, analysts say.
Hungary is expected to keep its fiscal deficit under control next year but additional budget measures to that aim are “unavoidable” since “the deficit requirements set by European Commission are unlikely to be met with the current structure,” Erste Bank added in a note.
OTP was the looser of the day, after investors were not impressed by an interview of the prime minister with Bloomberg in which Viktor Orban flagged a possible “normalisation” of the “extraordinarily high” size of the bank tax in Hungary for 2016 or 2017, if banks boost lending.
Investors rather focused on market rumor which holds that the government might want to combine MKB and Budapest Bank so that it could compete with OTP. The government has recently bought MKB from BayernLB and Budapest Bank from General Electric with the intention to sell them later to Hungarian “hands”.
The apparently unstoppable dive of the Russian rouble was also felt as OTP is active in both Russia and Ukraine, while the US threatened new sanctions against Russia, while the Russian foreign minister reminded that Russia was a one of the nuclear powers of the world.
European peers that resumed falling in the afternoon also pulled the BUX down.
OTP lost 2.94% to HUF 3,960 on turnover of HUF 8.45 bln from a HUF 12.95 bln session total, two-thirds above the daily average this year.
MOL fell 1.47% to HUF 11,360 on turnover of HUF 1.76 bln.
Magyar Telekom dropped 1.44% to HUF 343 on turnover of HUF 238 mln.
Richter retreated 1.73% to HUF 3,700 on turnover of HUF 2.39 bln.
The bourse’s mid-cap BUMIX went out 0.01% higher at 1,457.03.
Elsewhere in the region, Warsaw’s WIG20 was down 1.47%, while Prague’s PX dipped 0.99%. Western Europe’s major indices were all down ahead of their close Monday, FTSE-100 in London 1.28%, DAX30 in Frankfurt 1.82%, and CAC40 in Paris 1.96%.
Producing journalism that is worthy of the name is a costly business. For over 30 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.
