December 16, 2016 / 11:08 AM / 8 months ago

CEE MARKETS-Bonds recover, Romanian CDS hit multi-month high

* Bonds recover from post-Fed loss
    * Romanian CDS hits highest since Aug on political worries
    * Budapest stocks hit fourth consecutive daily record high

 (Adds rise of oil sector shares, fresh prices)
    By Sandor Peto
    BUDAPEST, Dec 16 (Reuters) - Central European government
bonds firmed and Hungarian stocks set a new record high on
Friday as global markets calmed down after jitters caused by
Wednesday's hawkish Federal Reserve comments.
    The Fed signalled faster interest rate hikes which would
reduce the appeal of high-yielding emerging market assets.
    Sentiment improved as the dollar retreated from Thursday's
14-year highs against the euro and the U.S. 10-year Treasury
yield dropped from its highest levels since 2014.
    Polish and Hungarian government bonds have almost fully
recovered from the Fed shock.
    Poland's 10-year bonds traded at a yield of 3.44 percent,
off Thursday's 3.59 percent peak, with the yield curve
flattening.
    Hungary's 10-year yield was fixed at 3.32 percent, down 5
basis points.
    The Polish yield is still higher by 40 basis points and the
Hungarian yield by 20 basis points from their levels before
Donald Trump won the U.S. presidential election on Nov. 8,
lifting inflation expectations there and debt yields around the
world.
    "Hedge funds have still not been able to scare real money
investors out of the long positions they manage, and yields are
again edging down," one Budapest-based fixed income trader said.
    Foreign investors have reduced their Hungarian bond holdings
by 240 billion forints ($801.47 million) since October to 3.51
trillion forints.
    But liquidity-boosting measures by the Hungarian central
bank have lifted demand from local players, and short-term
market yields were near record lows. 
    Hungarian equities have shrugged off the week's global
jitters, supported by three credit rating upgrades this year,
and good fundamentals of blue-chip companies.
    Budapest's stock index set a fourth daily record high
in a row.
    MOL rose 2.3 percent as a rise in crude to
a 17-month high boosted oil sector shares in the region. 
    Polish refiner PKN rose 1.7 percent. OMV Petrom
, Austrian OMV's Romanian unit, gained 3.6
percent.
    The forint, the zloty and the leu
 firmed in tandem by about 0.3 percent against the euro
by 1440 GMT, with the leu rebounding from 5-month lows.       
    Romanian bonds continued to lag behind European peers.    
Romania rejected all bids at a bond auction on Thursday after
there was no progress since Sunday's elections towards forming a
new government. 
    President Klaus Iohannis has suggested he will not accept
the election winner, Social Democrat leader Liviu Dragnea, as
prime minister because of his conviction for rigging a 2012
referendum, for which he was this year given a suspended
sentence.  
    Worries remain that the budget deficit will overshoot next
year.    
    The cost of insuring Romanian government debt against
default hit a 4-1/2-month high. 
           CEE      SNAP   AT  1540       
           MARKETS  SHOT  CET         
                    CURRENCIES            
                    Late  Prev  Dail  Chan
                    st    ious  y     ge
                    bid   clos  chan  in
                          e     ge    2016
 Czech     <EURCZK  27.0  27.0   +0.  -0.0
 crown     =>        220   305   03%    9%
 Hungary   <EURHUF  312.  313.   +0.  0.85
 forint    =>       0000  1550   37%     %
 Polish    <EURPLN  4.42  4.43   +0.  -3.6
 zloty     =>         08    12   24%    8%
 Romanian  <EURRON  4.51  4.52   +0.  0.19
 leu       =>         06    55   33%     %
 Croatian  <EURHRK  7.53  7.54   +0.  1.35
 kuna      =>         70    05   05%     %
 Serbian   <EURRSD  123.  123.   +0.  -1.6
 dinar     =>       4400  5500   09%    0%
 Note:     calcula  prev  clos  1800      
 daily     ted      ious  e at  CET   
 change    from                       
                    STOC                  
                    KS                
                    Late  Prev  Dail  Chan
                    st    ious  y     ge
                          clos  chan  in
                          e     ge    2016
 Prague             919.  911.   +0.  -3.8
                      99    98   88%    0%
 Budapest           3184  3163   +0.   +33
                    5.40  6.19   66%  .13%
 Warsaw    <.WIG20  1914  1911   +0.   +3.
           >         .92   .16   20%   00%
 Buchares           7066  6998   +0.   +0.
 t                   .17   .56   97%   88%
 Ljubljan  <.SBITO  710.  710.   +0.   +2.
 a         P>         45    28   02%   05%
 Zagreb    <.CRBEX  1966  1963   +0.   +16
           >         .15   .53   13%  .37%
 Belgrade  <.BELEX  721.  719.   +0.   +11
           15>        17    90   18%  .97%
 Sofia     <.SOFIX  579.  577.   +0.   +25
           >          14    90   21%  .65%
                    BOND                  
                    S                 
                    Yiel  Yiel  Spre  Dail
                    d     d     ad    y
                    (bid  chan  vs    chan
                    )     ge    Bund  ge
                                      in
 Czech                                spre
 Republic                             ad
   2-year  <CZ2YT=  -0.8  -0.0  -005  -2bp
           RR>        44    36   bps     s
   5-year  <CZ5YT=  -0.1  -0.0   +02  -3bp
           RR>        72    42  9bps     s
           <CZ10YT  0.51  -0.0   +02   +3b
 10-year   =RR>        9    16  0bps    ps
 Poland                                   
   2-year  <PL2YT=  1.98  0.02   +27   +3b
           RR>         8        8bps    ps
   5-year  <PL5YT=  2.79  -0.0   +32   +0b
           RR>         5    14  6bps    ps
           <PL10YT  3.47  -0.0   +31  -3bp
 10-year   =RR>        2    74  6bps     s
           FORWARD  RATE  AGREEMENT       
                    3x6   6x9   9x12  3M
                                      inte
                                      rban
                                      k
 Czech     <CZKFRA  0.26  0.22   0.2     0
 Rep       ><PRIBO                    
           R=>                        
 Hungary   <HUFFRA  0.38  0.41   0.5  0.39
           ><BUBOR                    
           =>                         
 Poland    <PLNFRA  1.75  1.77  1.79  1.73
           ><WIBOR     5           5  
           =>                         
 Note:     are for                        
 FRA       ask                        
 quotes    prices                     
 *****************************************
 *********************
 ($1 = 299.4500 forints)

 (Reporting by Sandor Peto; editing by Andrew Roche)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below