BUX recovers in line with Western markets

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The Budapest Stock Exchangeʼs main BUX index finished up 0.97% at 23,861.39 Tuesday, after loosing 1.20% Monday. It is down 0.25% from year-end. It finished the past year 43.81% higher, after losing 10.40% in 2014.

The Budapest parquet recovered while euro zone markets also licked wounds from Mondayʼs plunge on a mix of bargain hunting, a flood of new money from Chinaʼs central bank into the local market, and hopes for more anti-deflation ECB easing in the wake of Tuesdayʼs preliminary data on lower than expected, stagnant December inflation in the euro area.

Fresh official figures on Hungaryʼs general government deficit reaching a mere 0.4% of GDP last year by end-September on average, following two quarters of 0.5-0.5% surpluses each, added to the general feeling of comfort in the market. The government targets a 2.4% deficit for the whole of last year, but the result could come in much lower than that, economists said. But some analysts also point out that higher government revenues also reflect a tax burden on companies which limits borrowing and investment.

Another set of data on Monday from the National Bank of Hungary (MNB) attested to that: Hungarian non-financial companies were net lenders for the sixth year in the third quarter of last year. Net lending capacity of the corporate sector was 4.2% of GDP in the third quarter, down from 6.3% in the second quarter of last year, but up from 1.0% in the third quarter of 2014.

In the four quarters ending with September last year the net lending or financing capacity of the non-financial corporate sector was 3.2% of GDP, the highest in two years.

OTP won 0.77% to HUF 5,985 on turnover of HUF 2.93 bln from a preliminary HUF 6.08 bln session total, around tow-thirds of last yearʼs daily average.

MOL rose 0.71% to HUF 14,150 on turnover of HUF 990 mln.

Magyar Telekom added 0.25% to HUF 407 on turnover of HUF 252 mln.

Richter advanced 1.67% to HUF 5,490 on turnover of HUF 1.83 bln.

The bourseʼs mid-cap BUMIX went out 0.92% higher at 1,643.52.

Elsewhere in the region, WIG 20 in Warsaw was down 0.94%, while Pragueʼs PX increased 0.30%.

Western Europeʼs major indices were all up ahead of their close on Tuesday, FTSE100 in London 0.52%, DAX30 in Frankfurt 0.08%, and CAC40 in Paris 0.05%.

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