BUX rises for a sixth day

The Budapest bourse rose for a sixth consecutive trading day mainly on Richter, but also on an outlook upgrade to positive from stable of Hungaryʼs junk-rated debt by Moodyʼs late Friday, and on September trade data which came in half-positive on Monday.

The BUX bucked European mood that soured on worse-than-expected falls in Chinaʼs exports and imports, on auto shares that fell on Continentalʼs worse-than-expected third quarter results and on the French government foreclosing a merger between Renault and its Japanese partner Nissan, and on the G20 Financial Stability Board finalizing regulation to mandate the worldʼs top 30 banks to issue bust-buffering bonds up to EUR 1.1 trillion.

A first reading of Hungaryʼs foreign trade data showed trade balance almost doubled from August, but narrowed by 13% from a year ago, because imports grew faster.

Both exports and imports were higher from August, after falling in August in monthly comparison, but while annual imports growth accelerated in September from the preceding month, exports growth slowed.

Analysts consensus is for a 0.1% annual price fall in October after a 0.4% deflation in September. The pace of disinflation that is too slow compared to the very negative base in September last year which resulted from government mandated utility tariff cuts and fuel price falls, reflects a worrying general lack of price pressures in the economy, analysts say. Data is due on Tuesday.

After scaling technical resistance at HUF 4,800 last week, drugmaker Richter surged to a new all-time closing high. It reached its previous all-time closing high at HUF 4,970 on May 9, 2006. Its overall all-time high followed on May 10, 2006, intraday at HUF 5,079, and its intraday high on Monday, HUF 5,040 was not far from that. Richter is in vogue on its good overall prospects and a middle-October US licence for one of its drugs.

Oil company MOL raked up some gains earlier in the day to lose them in last trades after elections in neighboring Croatia. "It is worth waiting to see if there will be kind of a turnaround (in the Croatia-MOL relationship) after so many years," Erste said in a note referring to the former Croatian governmentʼs standpoint which deplored MOLʼs management rights in its less-than-50% owned Croatian peer, INA.

OTP Bank rose only modestly amid reverberations of a threat by Erste Group on Friday to withdraw from a February deal to sell a stake in its Hungarian unit to the government, saying recent official considerations to impose increased lending as a condition for tax cuts, and mandating banks to cover compensations for clients of Quaestor, a Hungarian brokerage that went bankrupt earlier in the year, have put the government on course to breach its agreement signed in February with the Austrian lender and the European Bank of Development and Reconstruction (EBRD) to lower the special bank levy with no strings attached, and to refrain from measure that increase the banksʼ burden.

Magyar Telekom seesawed to end unchanged as investors are unsure if it could raise tariffs following the EU-wide termination of roaming fees.

OTP rose 0.53% to HUF 5,688 on turnover of HUF 1.98 bln from a preliminary HUF 9.43 bln session total, more than 5% above the daily average this year.

MOL lost 0.37% to HUF 13,400 on turnover of HUF 1.27 bln.

Magyar Telekom ended flat at HUF 393 on turnover of HUF 262 mln.

Richter advanced 2.97% to HUF 5,020 on turnover of HUF 5.77 bln. 

The bourseʼs mid-cap BUMIX went out 0.66% higher at 1,611.71.

Elsewhere in the region, WIG 20 in Warsaw was down 0.34%, while Pragueʼs PX rose 0.26%.

Western Europeʼs major indices were all down ahead of their close on Monday, FTSE100 in London 0.78%, DAX30 in Frankfurt 1.26%, and CAC40 in Paris 1.33%.