CEE MARKETS-Hungarian bourse shines, led by OTP’s 2.3% jump to record high

By Krisztina Than
BUDAPEST, Dec 4 () – Hungary’s stock market rose over
1.6% on Wednesday morning, outperforming its Central European
peers as investor sentiment in the world improved with twists
and turns in the Sino-U.S. trade war keeping markets on a roller
coaster ride.
Central European currencies also firmed slightly, with the
Polish zloty up 0.1% in line with the Hungarian forint
, which also gained 0.1% to trade at around 331.30
versus the euro, distancing from its all-time low of 337.21 hit
last week.
« The Hungarian bourse jumped more than the others, in a
positive correction, » said Zoltan Varga, senior analyst at
brokerage Equilor. He said this could largely be due to a 2.3%
rise in OTP, Hungary’s largest bank, which rose to a
new record high at 14,630 forints on Wednesday.
OTP has been testing new highs for a while.
Budapest’s market gained 1.65% on the day by 1033
GMT, followed by Warsaw’s WIG 20 up 0.8% and Prague
flat.
Poland’s central bank holds a rate meeting later on
Wednesday where it is expected to keep interest rates unchanged,
as the region’s central banks maintain a wait and see mode with
economic growth expected to slow next year.
« Nobody expects the MPC to change interest rates on
Wednesday, but the tone of the comment may be eased, thus
supporting the domestic debt market, » PKO BP said in a note.
« The only fresh remark could be about the Supreme Court
ruling on FX mortgages which rocked asset markets last week –
the central bank may want to reassure markets that it has the
tools to counter any fallout from that ruling, » Commerzbank
analyst Tatha Ghose said in a note ahead of the meeting.
He said the forex mortgage story could be « one potential
source of exchange rate volatility going forward; the other
could be acceleration in core inflation. »
« Core inflation has accelerated in Poland in recent months
and this could become a factor later, but for now the central
bank’s status quo is likely to prove zloty-neutral, » Ghose
added.
The Polish zloty weakened last week after a Polish Supreme
Court verdict that investors fear raises the risk that Swiss
franc mortgage loans will be converted into the local currency
on terms unfavourable to banks.
Thousands of Poles took out Swiss franc-denominated
mortgages that have become prohibitively expensive to service
after the franc soared in value.
The National Bank of Hungary will publish the minutes of its
November rate meeting at 1300 GMT on Wednesday. The bank left
interest rates unchanged last month as expected.
The bank maintained its accommodative policy stance and
reiterated its view that dampening European economic activity
would keep a lid on domestic price pressures.
The bank next meets on Dec. 17 to discuss interest rates,
and fresh inflation and GDP projections that could give clues
regarding policy going head.

CEE SNAPSHOT AT
MARKETS 1042
CET
CURRENCIES
Latest Previou Daily Change
s
bid close change in 2019
EURCZK Czech %
EURHUF Hungary 0 %
EURPLN Polish %
EURRON Romanian %
EURHRK Croatian %
EURRSD Serbian 0 %
Note: calculated from 1800
daily CET
change

Latest Previou Daily Change
s
close change in 2019
.PX Prague 1077.57 1077.64 -0.01% +9.22%
00
.BUX Budapest 43645.24 43048.2 +1.39 +11.51
5 % %
.WIG20 Warsaw %
.BETI Buchares 9909.16 9879.22 +0.30 +34.20
t % %
.SBITO Ljubljan % %
.CRBEX Zagreb % %
.BELEX Belgrade
.SOFIX Sofia
BONDS
Yield Yield Spread Daily
(bid) change vs change
Bund in
Czech spread
Republic
CZ2YT= 2-year ps
CZ5YT= 5-year ps
CZ10YT ps
Poland
PL2YT= 2-year ps
PL5YT= 5-year ps
PL10YT ps
FORWARD RATE AGREEME
NT
3×6 6×9 9×12 3M
interba
nk
Czech
Hungary
Poland
Note: are for ask prices
FRA
quotes

(Reporting by Krisztina Than, additional reporting by Alan
Charlish
Editing by Giles Elgood)
Our Standards:The Thomson Trust Principles.