BUX further down on consumer price outlook


The Budapest Stock Exchange's main BUX index finished down 0.83% at 17,318.45 Friday, after falling 0.90% Thursday. It is down 6,71% from the end of last year, after it rose 2.15% in 2013. With European peers falling on disappointment at ECB's foggy quantitative easing guidance amid more euro area data pointing to deflation, the Budapest parquet also sank further in risk-off mood.

After Thursday's figures that showed deflation in Hungary deepened in November more than expected, uncertainty increased as analysts' views widely differ on whether the National Bank of Hungary (MNB) can or can not help with a resumption of base rate cuts next year. Analysts only agree on that Hungary's strong economic growth is to slow next year anyway.

A second reading on decelerating industrial output growth in October showed that while car production slowed, some other heavy-weight sectors e.g. food and electronics fell from a year ago.

In the general gloom, resulting in dumping shares in volumes rarely seen before, a newspaper interview on Friday with prime minister Viktor Orbán in which he said "a new chapter will begin soon" in the relationships with banks as "we want burdens on banks to be bearable, and in exchange the sector should play a much bigger role in financing the economy" went unheeded in the marketplace as well as a note from UniCredit which saw increasing chance for at least one credit-rating upgrade of Hungary to investment grade next year.

OTP lost 0.61% to HUF 4,080 on turnover of HUF 13.84 bln from a HUF 18.29 bln session total, more than twice the daily average this year. MOL fell 1.11% to HUF 11,530 on turnover of HUF 1.79 bln. Magyar Telekom ended flat at HUF 348 on turnover of HUF 428 mln. Richter retreated 1.31% to HUF 3,765 on turnover of HUF 2.18 bln. The bourse's mid-cap BUMIX went out 0.32% lower at 1,456.92.

Over the week, the BUX was down 2.44% after rising 2.32% the previous week. OTP was flat over the week after advancing 2.87% last week. MOL dove 5.34% after increasing 2.35% the previous week. Magyar Telekom dipped 1.69% after soaring 4.42% last week. Richter lost 2.71% after improving 0.91% over the previous week.

Elsewhere in the region, Warsaw's WIG20 was down 0.66%, while Prague's PX got rid of 1.32%. Western Europe's major indices were all down ahead of their close Friday, FTSE-100 in London 1.78%, DAX30 in Frankfurt 2.20%, and CAC40 in Paris 2.12%.



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