BUX further down with OTP plunging

Telco

The Budapest Stock Exchangeʼs main BUX index finished down 1.77% at 21,557.44 Friday after falling 0.54% Thursday. It is up 29.60% from year-end, after losing 10.40% last year.

While European peers tried to recuperate after a hit the preceding day from the chance that economic slowdown and a US tightening could come hand in hand soon, the Budapest bourse underperformed as it had its own problems to mind as well.

After a suspension on Thursday while 5% of it held by the state was sold in an auction, OTP Bank dove, only paring losses by close, after the auction price was more than 6% lower compared to its Wednesday close.

Drugmaker Richter also adjusted quickly down after more than a week of steep rises towards strong technical resistance seen at HUF 4,900, as investors suspect a state holding in it could be the next victim of the governmentʼs thirst for funds, although Hungaryʼs cabinet chief denied on Thursday the existence of such a plan.

In the background, fresh data pointed to continuing weaknesses in the economy.

Fridayʼs official figures showed producer price deflation deepened in Hungary in September.

After a slight improvement in August, corporate deleveraging came back with a vengeance in September in Hungary. Calculated from figures published by the central bank on Friday, corporate liabilities to financial institutions fell 0.6% by the end of September from end-August, while their deposits also thinned. Corporate credit volumes held by financial institutions were 7.7% smaller from a year ago, and 12.1% smaller compared to end-September 2013.

Households were also net repayers in September, with their deposits also narrowing.

OTP lost 3.44% to HUF 5,475 on turnover of HUF 13.52 bln from a preliminary HUF 18.06 bln session total, more than twice the daily average this year.

MOL ended flat at HUF 12,775 on turnover of HUF 1.38 bln.

Magyar Telekom rose 0.51% to HUF 392 on turnover of HUF 293 mln.

Richter retreated 2.64% to HUF 4,716 on turnover of HUF 2.82 bln.

The bourseʼs mid-cap BUMIX went out 0.03% higher at 1,594.21.

Over the week, the BUX fell 1.49% after raking up 0.14% in the previous, holiday-shortened, week.

OTP declined 3.06% after falling 0.39% last week.

MOL decreased 3.22% after increasing 1.42% in the preceding week.

Magyar Telekom garnered 2.62% after shedding 1.04% last week.

Richter gathered 0.30% after improving 0.04% over the previous week.

The BUMIX was down 0.53% after a loss of 0.39% over last week.

Elsewhere in the region, WIG 20 in Warsaw was up 0.03%, while Pragueʼs PX added 0.37%.

Western Europeʼs major indices were mixed ahead of their close on Friday, with FTSE100 in London down 0.73%, DAX30 in Frankfurt up 0.15%, and CAC40 in Paris down 0.08%.

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