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BUX rides European rally

The Budapest Stock Exchangeʼs main BUX index finished up 1.96% at 23,357.24 Friday, after rising 0.68% Thursday. It is down 2.36% from year-end, after surging 43.81% last year.

MOL = +1.62%

OTP = +3.67%

MTEL = -0.50%

RICHTER = +1.83%

The Budapest parquet rallied with European equities that were set for their first weekly rise this year, with higher commodity prices helping to add to gains from the previous session after stimulus hints from the European Central Bank.

With most blue chip companies interested in Russia, BUX was also supported by the surging ruble. MOL was specially propped up by quickly consolidating Brent prices.

On the domestic turf, the Hungarian Banking Association said it would soon file a court appeal against a HUF 4 bln Competition Office (GVH) fine for cartel activity.

GVH levied the fine last week citing the associationʼs database it said allowed banks to share business secrets for a period of no less than twelve years.

The Banking Association called the decision "legally and professionally incomprehensible" and said it was based on "mistaken assumptions and conclusions that disregard the operation of market competition".

Following cuts agreed with the European Bank for Reconstruction and Development (EBRD) and Erste Bank last February, Hungarian financial institutions are supposed to pay HUF 79.2 bln in special bank tax this year instead of an expected HUF 144.2 bln last year, so the fine would chip away more than 6% of the tax decrease.

The positive Richter "story" continued on Friday with the drugmaker announcing that it bought the 50% of Chinese unit Rxmidas Joint Venture Co. it didnʼt already own for an undisclosed sum to expand its business in China.

Hungaryʼ Prime Minister said in a radio interview that the government should now aim at diminishing its debt in absolute terms as well and not just proportionally to GDP. This perplexed analysts who calculated that such a venture would involve a balanced budget or even one with a surplus, which, in turn, would mean more austerity when the economy was already on a slowing path.

OTP won 1.62% to HUF 5,818 on turnover of HUF 5.17 bln from a preliminary HUF 9.54 bln session total, less than a tenth short of the daily average of the last 52 weeks.

MOL increased 3.67% to HUF 13,575 on turnover of HUF 1.35 bln.

Magyar Telekom fell 0.50% to HUF 396 on turnover of HUF 261 mln.

Richter advanced 1.83% to HUF 5,499 on turnover of HUF 2.66 bln.

The bourseʼs mid-cap BUMIX went out 1.18% higher at 1,648.78.

Over the week, the BUX lost 2.20% after shedding 0.31% in the previous week.

OTP let go 4.50% after garnering 3.31% last week.

MOL fell 0.18% after losing 2.51% in the preceding week.

Magyar Telekom was down 0.01% after easing 1.23% last week.

Richter deteriorated 2.07% over the week after falling 2.16% over the previous week.

The BUMIX ended the week 0.37% lower after a plus of 0.88% over last week.

Elsewhere in the region, WIG 20 in Warsaw was up 2.58%, while Pragueʼs PX garnered 3.13%.

Western Europeʼs major indices were all up ahead of their close on Friday, FTSE100 in London 2.18%, DAX30 in Frankfurt also 2.18%, and CAC40 in Paris 3.31%.