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BUX turns sharply north

Telco

The Budapest Stock Exchangeʼs main BUX index finished up 1.30% at 22,612.46 Thursday after diving 2.05% Wednesday. It is up 35.94% from year-end, after losing 10.40% last year. After the Labour Day holiday on Friday, the Budapest parquet reopens on Monday.

While European peers, perplexed after the US Fed continued to cover its hand, moved sideways, the BUX shot up on Wednesday after two days of falls, finishing just off its latest almost four-year closing high on Monday.

The Budapest parquet apparently followed the wider emerging market pattern, with investors taking to the view that better is to profit from any delay until the Fedʼs eventual rate hike than fret over how long the window of opportunity remains open.

The short-lived panic that the ECB might cut short its QE in the wake of improving euro zone inflation and lending data also abated.

Exposed to Eastern markets, most blue-chips were aided by a large, albeit smaller than expected, base rate cut in Russia, and OTP was back in vogue in both performance and volume terms also on a note from Czech brokerage Patria Finance which said Central European banking shares had upside potential in coming weeks as many are due to report sharp declines in risk premiums and provisioning with the first-quarter results. Banks with the most to gain are Erste Group and Hungaryʼs OTP, Patria Finance said.

Citigroup on Wednesday lifted its GDP growth forecasts for Hungary to 2.9% in 2015 from 2.7% earlier, and to 2.3% for 2016 from 2.1% previously.

Fresh statistics showing industrial producer prices deflation in Hungary continued for the third consecutive month, and outstanding loan stock of non-financial corporations fell steeply in March went unnoticed by both analysts and investors.

OTP won 2.18% to HUF 6,005 on turnover of HUF 12.64 bln from a HUF 19.29 bln session total, 85% above the daily average this year.

MOL gained 2.03% to HUF 15,050 on turnover of HUF 3.69 bln.

Magyar Telekom ended flat at HUF 405 on turnover of HUF 326m.

Richter advanced 0.13% to HUF 4,561 on turnover of HUF 2.51 bln.

The bourseʼs mid-cap BUMIX went out 0.43% higher at 1,612.79.

The BUX ended the holiday-shortened week up 0.86% after soaring 5.13% over the previous week.

OTP garnered 2.68% after gaining 4.99% last week.

MOL improved 1.01% after a plus of 3.29% the previous week.

Magyar Telekom fell 1.22% after losing 1.91% last week.

Richter eased 0.85% after surging 11.92% over the previous week.

The BUMIX won 0.53% after improving 1.82% over last week.

Elsewhere in the region, WIG 20 in Warsaw was down 0.14%, while Pragueʼs PX raked up 0.09%. Western Europeʼs major indices were mixed ahead of their close Thursday, with FTSE-100 in London down 0.09 %, DAX30 in Frankfurt up 0.18%, and CAC40 in Paris up 0.02%.


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