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CEE MARKETS-Stocks, FX jump as French vote removes a key risk
April 24, 2017 / 1:04 PM / 8 months ago

CEE MARKETS-Stocks, FX jump as French vote removes a key risk

    * Warsaw, Prague lead stock rebound on France, up 1.3 pct
    * Zloty, forint, crown up 0.4-0.6 pct vs euro
    * Leu underperforms; public wage bill expected
    * Romania sells 2-year bonds, yield drops

 (Adds Romanian bond auction, increased currency gains)
    By Sandor Peto
    BUDAPEST, April 24 (Reuters) - Central European assets,
mainly stocks and currencies rose on Monday after centrist
Emmanuel Macron won the first round of France's elections,
taking a big step towards becoming president.
    Fears of a strong performance of the anti-EU far-right and
radical left candidates had weighed on equities and currencies
in the European Union's emerging markets.
    Warsaw and Prague led a rebound of stocks,
with their indices rising 1.3 percent by 1231 GMT, outperforming
an 0.8 percent rise in MSCI's emerging market index.
    The zloty gained 0.4 percent, the Czech crown
 0.3 percent and the forint 0.2 percent.
Volatility gauges for the region fell sharply.
    The Polish and Hungarian currencies touched 2-week highs,
with the forint bouncing back from 4-month lows and the zloty
from one-month lows set before the French vote.
    One Budapest-based dealer said there was unusually brisk
trade in the forint's dollar cross after a jump by the
euro to a five-month high against the dollar.
    "The French election outcome, with all the earlier fears,
matched expectations. One risk is removed now," one dealer said.
    The region's government bonds, just like euro zone bonds,
were mixed.
    Romania sold the planned 800 million lei worth of 2-year
bonds at an auction, with the average yield dropping to 1.48
percent from 1.59 percent in a sale in early March. The bonds
traded around 1.45 percent later in the secondary market.    
    The leu underperformed other regional currencies,
firming less than 0.1 percent to 4.532 to the euro. 
    The Romanian government is expected to submit a bill to
parliament on Monday setting out further increases in public
sector wages. The Romanian net average wage jumped 14.7 percent
in annual terms in February.
    The Czech crown reversed an earlier slide on Monday. It
failed to make the gains many investors had bet on before the
central bank removed a cap on the crown's value at 27 to the
euro on April 6.
    The currency crown could remain volatile for months, Czech
central bank Governor Jiri Rusnok said on Friday. The bank will
let the market find a rate for the crown it considers proper, he
said.
    In Hungary, anti-government protests have caused jitters in
markets in the past three weeks, after the government passed
legislation targeting a university founded by billionaire George
Soros.
    The Hungarian central bank is expected to retain its loose
monetary policy at its meeting on Tuesday.
    
              CEE        SNAPS   AT  1431          
              MARKETS    HOT    CET           
                         CURRENCIES                
                         Lates  Previ  Daily  Chang
                         t      ous           e
                         bid    close  chang  in
                                       e      2017
 Czech crown             26.80  26.90   +0.3  0.75%
                            50     90     9%  
 Hungary                 311.4  313.0   +0.5  -0.84
 forint                    400    100     0%      %
 Polish                  4.240  4.264   +0.5  3.85%
 zloty                       8      3     5%  
 Romanian                4.532  4.536   +0.0  0.07%
 leu                         0      2     9%  
 Croatian                7.464  7.455  -0.12  1.21%
 kuna                        5      5      %  
 Serbian                 123.2  123.3   +0.0  0.06%
 dinar                     800    500     6%  
 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                  990.2  977.8   +1.2   +7.4
                             2      7     6%     4%
 Budapest                33143  32969   +0.5   +3.5
                           .85    .44     3%     6%
 Warsaw                  2292.  2264.   +1.2   +17.
                            54     07     6%    69%
 Bucharest               8284.  8232.   +0.6   +16.
                            88     84     3%    93%
 Ljubljana               779.2  773.4   +0.7   +8.5
                             5      4     5%     9%
 Zagreb                  1945.  1949.  -0.18  -2.46
                            71     21      %      %
 Belgrade     <.BELEX15  734.4  733.9   +0.0   +2.3
              >              0      6     6%     7%
 Sofia                   658.9  657.9   +0.1   +12.
                             7      7     5%    37%
                         BONDS                     
                         Yield  Yield  Sprea  Daily
                                       d      
                         (bid)  chang  vs     chang
                                e      Bund   e in
 Czech                                        sprea
 Republic                                     d
   2-year     <CZ2YT=RR  0.023  0.108   +072   +3bp
              >                          bps      s
   5-year     <CZ5YT=RR  0.273  0.055   +061  -5bps
              >                          bps  
   10-year    <CZ10YT=R  1.035  0.026   +069  -7bps
              R>                         bps  
 Poland                                            
   2-year     <PL2YT=RR  1.979  0.003   +267  -7bps
              >                          bps  
   5-year     <PL5YT=RR  2.852  0.011   +319  -9bps
              >                          bps  
   10-year    <PL10YT=R  3.409  0.004   +306  -9bps
              R>                         bps  
              FORWARD    RATE   AGREEMENT          
                         3x6    6x9    9x12   3M
                                              inter
                                              bank
 Czech Rep            <   0.33   0.37   0.46      0
              PRIBOR=>                        
 Hungary              <   0.23  0.325   0.41   0.16
              BUBOR=>                         
 Poland               <  1.755   1.78   1.84   1.73
              WIBOR=>                         
 Note: FRA    are for                              
 quotes       ask                             
              prices                          
 **************************************************
 ************
 
 (Additional reporting by Jason Hovet and Robert Muller in
Prague; Editing by Tom Heneghan)
  
 
 

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