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CEE MARKETS-Budapest stocks fall from record high after Magyar Telekom disappoints
February 23, 2017 / 10:27 AM / 9 months ago

CEE MARKETS-Budapest stocks fall from record high after Magyar Telekom disappoints

    * Budapest stocks off record on OTP Bank, Magyar Telekom
retreat
    * Magyar Telekom guidance disappoints despite profit surge
    * Bucharest stocks at another 9-year high on Banca
Transilvania
    * Currencies, bonds rangebound ahead of auctions

    By Sandor Peto
    BUDAPEST, Feb 23 (Reuters) - Budapest stocks retreated from
record highs on Wednesday, driven by Magyar Telekom
which opted against raising its dividend guidance despite a
surge in profits, while Central European assets mostly moved
sideways.
    OTP, Hungary's biggest lender also retreated,
shedding 2.1 percent, following a week-long surge which saw the
stock hit its highest levels since 2007 by Tuesday.    
    Regional markets, which have tracked a worldwide rally of
equities in the past weeks, took a pause, with no new cues
coming from abroad and as investors reacted to earnings results.
    Magyar Telekom, the Hungarian unit of Deutsche Telekom
, said its fourth quarter profit leapt to 19.8 billion
 forint ($67.84 million) from 3.35 billion a year earlier,
partly due to tax changes.
    But it cited competitive and regulatory risks to growth this
year and maintained its dividend target, disappointing investors
and prompting a 2.3 percent fall in its share price. Budapest's
main stock index shed 1.1 percent by 1008 GMT.
    "The management's communication signals the importance of
caution over forecasts," Erste group analysts said in a note.
    The stocks of Deutsche Telekom's Croatian unit, HT,
meanwhile, rose 1.2 percent as the firm's earnings report showed
a rise in revenues and profits. 
    Bank stocks were mixed in the region.
    The improved earnings and outlook of some banks have played
a key part in the regional equities rally in the past weeks.
    Shares in Romania's Banca Transilvania extended
their gains after a strong earnings report last week, rising 0.4
percent and lifting the Bucharest index, which has hit
new 9-year highs this week.
    Romania and Serbia are due to hold bond auctions.
    Serbia's central bank forecast 3.5 percent economic growth
for 2018 on Tuesday, and the country's improved prospects lift 
the appeal of its auction, but the high amount on offer could
lead to a rise in yields, Raiffeisen analysts said in a note. 
    In Romania, the European Commission's warning over a likely
rise in the budget deficit and optimistic economic assumptions
in the fresh 2017 budget indicate risks, the analysts said.
    "We do not see the need for changing our Hold recommendation
on Romania at this stage while we would highlight fiscal risk
possibly impacting the outlook," they added.     
              CEE        SNAPS   AT  1119          
              MARKETS    HOT    CET           
                         CURRENCIES                
                         Lates  Previ  Daily  Chang
                         t      ous           e
                         bid    close  chang  in
                                       e      2017
 Czech crown             27.02  27.02   +0.0  -0.05
                            00     00     0%      %
 Hungary                 307.9  307.8  -0.03  0.28%
 forint                    500    700      %  
 Polish                  4.306  4.301  -0.11  2.27%
 zloty                       0      2      %  
 Romanian                4.518  4.519   +0.0  0.37%
 leu                         5      5     2%  
 Croatian                7.431  7.447   +0.2  1.67%
 kuna                        0      5     2%  
 Serbian                 123.8  123.9   +0.0  -0.43
 dinar                     800    200     3%      %
 Note: daily  calculate  previ  close  1800        
 change       d from     ous    at     CET    
                         STOCK                     
                         S                    
                         Lates  Previ  Daily  Chang
                         t      ous           e
                                close  chang  in
                                       e      2017
 Prague                  971.7  972.7  -0.10   +5.4
                             4      2      %     4%
 Budapest                33734  34112  -1.11   +5.4
                           .71    .89      %     1%
 Warsaw                  2249.  2251.  -0.06   +15.
                            68     02      %    49%
 Bucharest               8053.  8035.   +0.2   +13.
                            98     25     3%    68%
 Ljubljana               774.0  771.6   +0.3   +7.8
                             5      7     1%     7%
 Zagreb                  2245.  2234.   +0.5   +12.
                            96     26     2%    59%
 Belgrade     <.BELEX15  713.2  714.2  -0.15  -0.58
              >              1      8      %      %
 Sofia                   609.2  610.3  -0.19   +3.8
                             2      5      %     9%
                         BONDS                     
                         Yield  Yield  Sprea  Daily
                                       d      
                         (bid)  chang  vs     chang
                                e      Bund   e in
 Czech                                        sprea
 Republic                                     d
   2-year     <CZ2YT=RR  -0.49  0.005   +039  -1bps
              >              2           bps  
   5-year     <CZ5YT=RR  0.166  -0.08   +070  -9bps
              >                     6    bps  
   10-year    <CZ10YT=R  0.623  -0.05   +036  -5bps
              R>                    5    bps  
 Poland                                            
   2-year     <PL2YT=RR  2.237  0.013   +312   +0bp
              >                          bps      s
   5-year     <PL5YT=RR  3.209  -0.00   +374  -1bps
              >                     5    bps  
   10-year    <PL10YT=R   3.87  -0.02   +361  -2bps
              R>                    9    bps  
              FORWARD    RATE   AGREEMENT          
                         3x6    6x9    9x12   3M
                                              inter
                                              bank
 Czech Rep            <   0.27   0.29   0.31      0
              PRIBOR=>                        
 Hungary              <  0.355  0.505   0.62   0.24
              BUBOR=>                         
 Poland               <   1.76  1.795   1.88   1.73
              WIBOR=>                         
 Note: FRA    are for                              
 quotes       ask                             
              prices                          
 **************************************************
 ************
 ($1 = 291.8500 forints)

 (Reporting by Sandor Peto; editing by Richard Lough)
  
 
 

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