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BUX further up, but slows

Telco

The Budapest Stock Exchangeʼs main BUX index finished up 0,33% at 22,130.60 Thursday after rising 1.99% Wednesday. It is up 33.04% from year-end, after losing 10.40% last year.

With tailwind from euro zone markets, the Budapest bourse continued to rise on Thursday, albeit at a more timid pace from Wednesday, and slowing within the day as well in afternoon trades.

Investors received with caution fresh data on retail trade in Hungary which showed accelerating growth in October in annual terms after two months of sharp slowdown. Monthly volume figures will be available only at the end of November, and earlier numbers showed falls in monthly comparison.

The European Commission slightly raised its projection for Hungaryʼs economic growth to 2.9% from 2.8% seen in May, but left its forecast for next year unchanged at 2.2%. The GDP growth assumption in Hungaryʼs 2016 budget is 2.5%. Last year, Hungaryʼs economy grew at an "exceptional rate" of 3.7%, the EC noted, against official Hungarian data of 3.6%.

Meanwhile, the European Bank for Reconstruction and Development (EBRD) raised its forecast for Hungaryʼ growth to 2.9% from 2.6% seen in May, but projected 2.1% growth next year, down from 2.3% seen in May.

Market mood was also cautious as Hungaryʼs cabinet chief said at a regular Thursday afternoon press briefing that the government prepared to buy out further public utility companies with the aim of returning the sector to the situation before the privatizations in the 1990s.

Profit taking in final trades took away small gains from Magyar Telekom. For most of the day it adjusted up after third quarter net income came in Wednesday evening with a slightly smaller annual fall than projected. The company raised its EBITDA guidance for the whole year, and confirmed its intention to resume dividend payment on this yearʼs earnings.

Drugmaker Richter corrected down after recent spectacular rises, culminating in a 3.24% surge on Wednesday on encouraging third quarter results and guidance.

Oil company MOL was up on rising fuel prices, and expectations for robust third quarter results to be announced on Friday. Analysts expect MOL to report a net loss due to the one-off effect of a write-down on lower-than-expected geological potential of its Akri-Bijeel Block in Iraqi Kurdistan, but clean earnings before interest, tax, depreciation and amortization is seen reaching a record high for the second quarter in a row as higher refining margins, persistently strong petrochemicals and retail sales performance boosted the downstream segment.

OTP Bank continued to recuperate from a plunge last week caused by an auction sale of its previously government-held 5%.

OTP rose 1.69% to HUF 5,664 on turnover of HUF 6.80 bln from a preliminary HUF 10.87 bln session total, more than a fifth above the daily average this year.

MOL gained 0.76% to HUF 13,300 on turnover of HUF 710 mln.

Magyar Telekom ended flat at HUF 393 on turnover of HUF 367 mln. 

Richter retreated 1.58% to HUF 4,800 on turnover of HUF 2.85 bln.

The bourseʼs mid-cap BUMIX went out 0.25% higher at 1,600.15.

Elsewhere in the region, WIG 20 in Warsaw was down 1.01%, while Pragueʼs PX shed 0.54%.

Western Europeʼs major indices were mixed ahead of their close on Thursday, with FTSE100 in London down 0.75%, DAX30 in Frankfurt up 0.28%, and CAC40 in Paris up 0.62%.

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