June 11, 2020 / 10:51 AM / 24 days ago

CEE MARKETS-Prague index drops most since April as gloomy Fed hits stocks

    PRAGUE, June 11 (Reuters) - Czech shares fell the most in
two months on Thursday as central European bourses retreated
after a downbeat outlook from the U.S. Federal Reserve cooled
expectations of a swift global recovery from the coronavirus
pandemic.
    Currencies also eased to the weak end of ranges they have
stuck to so far in June after gains in May.
    Risk appetite waned after the Fed's outlook showed a
years-long battle to recover the jobs and economic ground lost
due to the new coronavirus outbreak that put much of the world
in lockdown for a period this year.
    The main Prague stock index fell more than 3% on
Thursday and was down 2.9% at 0947 GMT, putting it on course for
its biggest one-day drop since mid-April. Bank stocks were
hardest hit.
    "The Fed outlook showed the economy was not in as great
shape as the market was thinking," J&T Banka's head of research
Milan Vanicek said. 
    Budapest lost 1.2%. Warsaw was closed for holiday.
    Bucharest lost 1.6%. 
    Romanian lawmakers on Wednesday passed a bill postponing any
plans to list or privatise state-owned companies by two years, a
move that analysts and investors said would stunt capital
markets and isolate the economy.
    Central Europe's economies face steep recessions in 2020
because of the coronavirus impact despite gradually reopening
since May.
    While analysts project currencies to gradually gain, most
have steadied into tight ranges this month. On Thursday, the
Polish zloty fell 0.4% to 4.47 to the euro and
Hungary's forint eased 0.3%, approaching the technical
345 level. 
    The Czech crown edged down 0.1%, cutting some
losses in early trading. 
    On bond markets, Czech yields fell after the Fed news, with
5-year paper bid at 0.52%, staying off lows touched in May.
     
                                CEE MARKETS        SNAPSHOT  AT                        
                                                               1147 CET                
                                                                                       
                                CURRENCIES                                             
                                                   Latest    Previous        Daily     Change
                                                   bid       close           change    in 2020
 EURCZK=    Czech crown                            26.5890   26.5635         -0.10%    -4.35%
 EURHUF=    Hungary forint                         344.3300  343.3600        -0.28%    -3.83%
 EURPLN=    Polish zloty                           4.4700    4.4532          -0.38%    -4.78%
 EURRON=    Romanian leu                           4.8365    4.8352          -0.03%    -1.00%
 EURHRK=    Croatian kuna                          7.5680    7.5695          +0.02%    -1.62%
 EURRSD=    Serbian dinar                          117.5400  117.5600        +0.02%    +0.03%
            Note: daily change  calculated from                              1800 CET  
                                                                                       
                                STOCKS                                                 
                                                   Latest    Previous        Daily     Change
                                                             close           change    in 2020
 .PX        Prague                                 914.20    941.9200        -2.94%    -18.06%
 .BUX       Budapest                               37050.96  37514.79        -1.24%    -19.60%
 .WIG20     Warsaw                                 1841.18   1841.18         +0.00%    -14.37%
 .BETI      Bucharest                              8688.25   8830.41         -1.61%    -12.92%
 .SBITOP    Ljubljana                              868.62    872.83          -0.48%    -6.18%
 .CRBEX     Zagreb                                 1658.98   1658.98         +0.00%    -17.77%
 .BELEX15   Belgrade                               680.12    681.96          -0.27%    -15.16%
 .SOFIX     Sofia                                  459.93    462.28          -0.51%    -19.05%
                                                                                       
                                BONDS                                                  
                                                   Yield     Yield           Spread    Daily
                                                   (bid)     change          vs Bund   change in
            Czech Republic                                                             spread
 CZ2YT=RR   2-year                                 0.2170    0.0520          +085bps   +7bps
 CZ5YT=RR   5-year                                 0.5230    -0.0440         +113bps   -1bps
 CZ10YT=RR  10-year                                0.9230    0.0040          +131bps   +6bps
            Poland                                                                     
 PL2YT=RR   2-year                                 0.2640    0.0230          +089bps   +4bps
 PL5YT=RR   5-year                                 0.8490    0.0200          +146bps   +6bps
 PL10YT=RR  10-year                                1.4050    -0.0100         +179bps   +5bps
                                                                                       
                                FRA                                                    
                                                   3x6       6x9             9x12      3M interbank
            Czech Rep                              0.30      0.34            0.36      0.34
            Hungary                                0.79      0.72            0.68      0.90
            Poland                                 0.26      0.25            0.28      0.27
            Note: FRA quotes are for ask prices                                        
            **************************************************************
                                                                                       
 
 (Reporting by Jason Hovet in Prague, Anita Komuves in Budapest
and Radu Marinas in Bucharest; editing by Emelia
Sithole-Matarise)
  
 
 
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