BUX accelerates, but underperforms

Telco

The Budapest Stock Exchangeʼs main BUX index finished up 1.00% at 22,507.23 Thursday after rising 0.63% Wednesday. It is up 35.31% from year-end, after losing 10.40% last year.

An audible sigh of relief in euro zone markets after Greeceʼs parliament adopted terms of a new bailout program helped blow quotations in Budapest, too.

Some news of the day, including an annual jump in June of new car registrations in Hungary, and a doubling of a government subsidy program to HUF 1 bln to encourage costumers to replace their old washing machines to new ones also supported the market as they raised, in general, faint hopes for some improvement in consumer demand, but the main index underperformed most European peers on other local worries.

Analysts calculate a fresh suspension of disbursement of EU funds for already contracted road construction projects resulting from tenders the market conformity of which Brussels disputes, concern a sum of €573 mln.

This comes on top of an EU decision on Wednesday to open in-depth investigations into Hungaryʼs HUF 40 bln annual supermarket oversight fee and healthcare contribution payable by tobacco companies, and, pending the investigation, to prohibit the application of their rates Brussels deems overly progressive, and country specific recommendations from the Council of the EU on Tuesday according to which the Hungarian government should achieve fiscal adjustments of 0.5% of GDP towards the medium-term budgetary objective in 2015 and of 0.6% in 2016, and reform basic tenets of its economic, tax, market regulation, employment and social security policies.

OTP rose 0.68% to HUF 5,924 on turnover of HUF 8.29 bln from a HUF 12.72 bln session total, nearly a third above the daily average this year.

MOL gained 1.58% to HUF 14,750 on turnover of HUF 2.48 bln.

Magyar Telekom won 0.25% to HUF 394 on turnover of HUF 1.14 bln.

Richter advanced 1.25% to HUF 4,293 on turnover of HUF 764m.

The bourseʼs mid-cap BUMIX went out 0.62% higher at 1,672.45.

Elsewhere in the region, WIG 20 in Warsaw was up 1.68%, while Pragueʼs PX garnered 1.59%.

Western Europeʼs major indices were all up ahead of their close on Thursday, FTSE100 in London 0.61%, DAX30 in Frankfurt 1.60%, and CAC40 in Paris 1.46%.

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