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CEE MARKETS-Budapest stocks hit record high, crown tests 3 1/2-year peak
June 2, 2017 / 9:21 AM / 4 months ago

CEE MARKETS-Budapest stocks hit record high, crown tests 3 1/2-year peak

    * Local, regional economic data fuel optimism in markets
    * Budapest stock index sets record above 35,000-point mark
    * Czech GDP breakdown underpins continuing regional growth
    * Czech crown hovers near strongest levels since late 2013

    By Sandor Peto
    BUDAPEST, June 2 (Reuters) - Budapest stocks hit a record
high and the Czech crown was testing a 3 1/2-year peak
on Friday after economic data from the United States and Central
Europe lifted investor confidence.
    Budapest's main stock index crossed the 35,000-point
mark, surging to a record high before retreating below that line
by 0823 GMT, though still up 0.5 percent.
    Thursday's May Czech and Polish manufacturing indices
pointed to slower than expected economic expansion. But this
week's regional data - including the first-quarter Czech
economic output breakdown on Friday - confirmed continuing
strong growth. Hungary's PMI hit a all-time high in May.
    That trend underpins regional currencies and stocks.
    Upbeat U.S. manufacturing data sent Poland's zloty
into a brief retreat against both the dollar and euro late on
Thursday. Against the euro, the zloty pierced the 4.2
psychological line but returned to 4.188 by Friday, up 0.2
percent as global markets were awaiting U.S. payroll figures due
at 1230 GMT in an upbeat mood. 
    The Czech crown hit a multi-year high already in overnight
trade at 26.318 and was flirting with that level again on
Friday. A Prague-based dealer said the crown market was now
quiet, but still had some space for gains.
     "There is still some momentum but pretty slow. But I think
we are getting to levels where I would expect some profit
taking," the dealer said, adding that the Czech central bank
(CNB) was probably happy with the crown's trajectory so far.
     Two months ago the CNB removed a cap which had kept the
crown weaker than 27 against the euro since 2013. Investors who
had bought tens of billions of euros worth of crowns eagerly
await stronger levels to take profits.
    A Reuters poll of analysts conducted this week projected a
rise in the crown to 25.75 in the next 12 months, and a range
between 26.2 and 27 until the end of September.
    "We still see the first hike of CNB rates in 2018 as the
most likely outcome, due to the loose policy of the ECB and the
expected slowdown in Czech inflation at the 2017/18 turn," Erste
analyst Jiri Polansky said after Friday's GDP breakdown data.
    In stock markets, Alior Bank bucked a rise of
Polish shares, and shed as much as 5.5 percent, after its CEO
and co-founder Wojciech Sobieraj said he would not apply for
another term.
     Hungary's Konzum, a holding company part-owned by
businessman Lorinc Meszaros, an ally and friend of Prime
Minister Viktor Orban, surged 17 percent after saying on
Thursday that it had acquired a 45 percent indirect stake in MKB
Bank.
    Another firm part-owned by Meszaros, Opimus, which
in April acquired a stake in FHB Bank, gained 7.6
percent.
    Bulgaria's main stock index rose 0.6 percent. Later
on Friday, Standard & Poor's may upgrade the outlook from stable
to positive on its BB+ rating for Bulgaria, Raiffeisen analyst
Gintaras Shlizhyus said in a note.    
                CEE MARKETS  SNAPSH   AT  1023 CET         
                             OT                      
                             CURRENCIES                    
                             Latest  Previo  Daily   Change
                                     us              
                             bid     close   change  in
                                                     2017
 Czech crown                 26.323  26.333   +0.04   2.60%
                                  0       0       %  
 Hungary                     308.20  307.87  -0.11%   0.20%
 forint                          00      00          
 Polish zloty                4.1880  4.1968   +0.21   5.16%
                                                  %  
 Romanian leu                4.5660  4.5691   +0.07  -0.68%
                                                  %  
 Croatian kuna               7.4110  7.4150   +0.05   1.94%
                                                  %  
 Serbian dinar               122.17  122.45   +0.23   0.97%
                                 00      00       %  
 Note: daily    calculated   previo  close   1800          
 change         from         us      at      CET     
                             STOCKS                        
                             Latest  Previo  Daily   Change
                                     us              
                                     close   change  in
                                                     2017
 Prague                      1010.6  1006.0   +0.46   +9.66
                                  7       8       %       %
 Budapest                    34947.  34762.   +0.53   +9.20
                                 15      46       %       %
 Warsaw                      2296.3  2278.2   +0.79   +17.8
                                  5       6       %      9%
 Bucharest                   8769.4  8688.5   +0.93   +23.7
                                  1       0       %      7%
 Ljubljana                   791.04  792.01  -0.12%   +10.2
                                                         4%
 Zagreb                      1849.2  1848.4   +0.04  -7.30%
                                  3       2       %  
 Belgrade                    718.36  719.93  -0.22%   +0.14
                                                          %
 Sofia                       668.14  664.08   +0.61   +13.9
                                                  %      3%
                             BONDS                         
                             Yield   Yield   Spread  Daily
                             (bid)   change  vs      change
                                             Bund    in
 Czech                                               spread
 Republic                                            
   2-year                    -0.118   0.066   +059b   +7bps
                                                 ps  
   5-year                    -0.156   0.039   +028b   +6bps
                                                 ps  
   10-year                    0.682   0.006   +039b   +2bps
                                                 ps  
 Poland                                                    
   2-year                     1.913   0.003   +263b   +1bps
                                                 ps  
   5-year                     2.653  -0.001   +309b   +2bps
                                                 ps  
   10-year                     3.23  -0.012   +294b   +0bps
                                                 ps  
                FORWARD      RATE    AGREEMENT             
                             3x6     6x9     9x12    3M
                                                     interb
                                                     ank
 Czech Rep              <PR    0.34    0.41    0.48       0
                IBOR=>                               
 Hungary                <BU    0.19    0.23    0.29    0.15
                BOR=>                                
 Poland                 <WI    1.76    1.79     1.8    1.73
                BOR=>                                
 Note: FRA      are for ask                                
 quotes         prices                               
 **********************************************************
 ****
 
 (Additional reporting by Jason Hovet in Prague, Anna Koper and
Marcin Goclowski in Warsaw; editing by Mark Heinrich)
  
 
 

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