October 25, 2018 / 8:19 AM / a month ago

CEE MARKETS-Stocks plunge, Hungarian auctions demand seen strong

    * Bucharest leads stocks decline after Wall Street plunge
    * Forint, zloty weaken on global risk aversion
    * Hungarian bonds are seen drawing sound demand

    By Sandor Peto
    BUDAPEST, Oct 25 (Reuters) - Hungarian bond prices firmed
slightly ahead of the government's bi-weekly auctions on
Thursday, expected to attract healthy demand despite jitters in
global markets.
    After a slump in Wall Street technology shares knocked world
stocks lower, Bucharest led a decline in Central Europe. 
    Its main index, which has outperformed regional
peers in the past weeks, fell 1.2 percent by 0750 GMT,
continuing to retreat from last week's 5-month highs.
    The bluechip index of Warsaw, the region's biggest
stock market, hit a 4-month low, falling by 0.7 percent.  
    Risk aversion in the world also weighed on Central European
currencies, mainly the forint and, which
eased in tandem by 0.2 percent against the euro.
    Trading at 323.6 and 4.3140, respectively, they were still
near the past few weeks' typical ranges, and the weakening is
unlikely to dampen appetite for the bonds offered at Hungary's
auctions, one Budapest-based trader said.
    "I expect relatively strong demand near the current
secondary market yields," the trader said.
    "Interest rate payments (on government debt) this week and
next are boosting liquidity, while some of the 2018/D bond
expiry worth 150 billion forints can be also reinvested," the
trader added.
    Hungarian government bond yields were lower by a 1-3 basis
points, after an about 5 basis point decline on Wednesday, with
the 10-year paper trading at 3.73 percent.
    The forint is moving in an "acceptable and tolerable" range
for the central bank, rate-setter Gyula Pleschinger was quoted
late on Wednesday as saying.
    He also said the bank should not start to increase interest
rates before unwinding the monetary stimulus built up through
its unconventional tools.
    The European Central Bank's comments after its interest rate
decision will be closely watched, but are unlikely to change
sentiment, market participants said.
    "I do not expect hawkish comments," the trader said.
    
            CEE       SNAPSHOT   AT                         
            MARKETS             0950 CET            
                      CURRENCI                              
                      ES                            
                      Latest    Previous  Daily     Change
                      bid       close     change    in 2018
 Czech      <EURCZK=   25.8450   25.8550    +0.04%    -1.17%
 crown      >                                       
 Hungary    <EURHUF=  323.6000  323.1100    -0.15%    -3.92%
 forint     >                                       
 Polish     <EURPLN=    4.3140    4.3070    -0.16%    -3.19%
 zloty      >                                       
 Romanian   <EURRON=    4.6620    4.6595    -0.05%    +0.38%
 leu        >                                       
 Croatian   <EURHRK=    7.4300    7.4285    -0.02%    +0.00%
 kuna       >                                       
 Serbian    <EURRSD=  118.5000  118.6300    +0.11%    +0.00%
 dinar      >                                       
 Note:      calculated from               1800 CET          
 daily                                              
 change                                             
                                                            
                      Latest    Previous  Daily     Change
                                close     change    in 2018
 Prague                1054.55  1062.160    -0.72%    -2.19%
                                       0            
 Budapest             36460.13  36452.74    +0.02%    -7.41%
 Warsaw                2128.86   2144.40    -0.72%   -13.50%
 Bucharest             8524.00   8626.14    -1.18%    +9.93%
 Ljubljana  <.SBITOP    807.70    809.95    -0.28%    +0.16%
            >                                       
 Zagreb                1779.93   1782.68    -0.15%    -3.42%
 Belgrade   <.BELEX1    749.01    735.70    +1.81%    -1.42%
            5>                                      
 Sofia                  598.25    600.14    -0.31%   -11.69%
                      BONDS                                 
                      Yield     Yield     Spread    Daily
                      (bid)     change    vs Bund   change
                                                    in
 Czech                                              spread
 Republic                                           
   2-year   <CZ2YT=R    1.6140    0.1180   +228bps    +11bps
            R>                                      
   5-year   <CZ5YT=R    1.8910    0.0330   +209bps     +3bps
            R>                                      
   10-year  <CZ10YT=    2.1640    0.0090   +178bps     +1bps
            RR>                                     
 Poland                                                     
   2-year   <PL2YT=R    1.5520    0.0110   +222bps     +1bps
            R>                                      
   5-year   <PL5YT=R    2.4380    0.0030   +263bps     +0bps
            R>                                      
   10-year  <PL10YT=    3.1700   -0.0070   +278bps     -1bps
            RR>                                     
            FORWARD   RATE      AGREEMEN                    
                                T                   
                      3x6       6x9       9x12      3M
                                                    interban
                                                    k
 Czech Rep                2.06      2.24      2.39      1.77
            <PRIBOR=                                
            >                                       
 Hungary                  0.36      0.62      0.98      0.16
                                                    
 Poland                   1.77      1.80      1.86      1.72
                                                    
 Note: FRA  are for ask prices                              
 quotes                                             
 *************************************************          
 *************                                      
 
 (Reporting by Sandor Peto
Editing by Robin Pomeroy)
  
 
 
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