BUX underperforms


The Budapest Stock Exchangeʼs main BUX index finished down 0.32% at 21,964.72 Wednesday after rising 0.89% Tuesday. It is up 32.05% from year-end, after losing 10.40% last year.

The Budapest parquet could not catch up with European peers which shot up in the afternoon.

Investors digested the latest figures on consumer prices shooting up more than expected last month in Hungary after an eight-month spell of deflation, while the minutes of the end-May meeting of the Monetary Council of the National Bank of Hungary (MNB), published on Wednesday, showed policymakers were still expecting disinflationary pressure. And the long-awaited return of inflation came amid slowing consumer demand.

The prospect of negative real interest rates, a decision of the MNB last week to replace the two-week deposit with the three-month deposit as its main policy instrument from September -- a measure with the probable effect of shepherding more of banksʼ funds into short-term government paper -- and another decision on Wednesday of the MNB to require lenders to back at least 15% of their net mortgage loans with long-term liabilities from October next year -- a measure that will syphon off about HUF 279 bln from the market -- also did not augur well for investments and may dent recently upbeat economic growth expectations, analysts said.

OTP corrected up 0.39% to HUF 5,420 on turnover of HUF 3.59 bln from a HUF 7.66 bln session total, three-quarters of the daily average this year.

MOL fell 1.16% to HUF 14,440 on turnover of HUF 1.50 bln.

Magyar Telekom lost 0.94% to HUF 423 on turnover of HUF 565 mln.

Richter retreated 0.05% to HUF 4,421 on turnover of HUF 1.93 bln.

The bourseʼs mid-cap BUMIX went out 0.16% lower at 1,591.54.

Elsewhere in the region, WIG 20 in Warsaw was up 1.86%, while Pragueʼs PX rose 1.45%.

Western Europeʼs major indices were all up ahead of their close Wednesday, FTSE100 in London 1.04%, DAX30 in Frankfurt 2.00%, and CAC40 in Paris 1.56%.


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