May 15, 2020 / 10:56 AM / 10 days ago

CEE MARKETS-Stocks rise tracking rally in Western European equities

    By Anita Komuves
    BUDAPEST, May 15 (Reuters) - Central European stock markets
rose and most currencies edged higher on Friday, tracking a
rally in Western European shares driven by positive economic
data from China.  
    The DAX index of Germany, Central Europe's biggest
trading partner, rose 1.76% by 1022 GMT as data showed China's
industrial production rose in April after having contracted
since the start of the coronavirus outbreak. 
    Preliminary first-quarter gross domestic product (GDP) data
came in better than expected in nearly all the countries of
Central Europe, despite the economic damage wrought by the
pandemic.
    Hungary's growth rate halved to an annual 2.2% in the first
quarter from 4.5% in the last quarter of 2019. Poland's GDP rose
1.9% year-on-year, while Romania's economy grew 2.4% on the year
in the first quarter.     
    The Czech GDP dropped by 3.6% in the first quarter, versus
the previous three months, the steepest drop since the global
financial crisis in 2009.
    "It is the extent of decline in Q2, and the extent of
rebound in Q3 which the market is essentially interested in.
Hence, today's data is likely to turn out to be FX neutral,"
Commerzbank said in a note.
    Hungarian Prime Minister Viktor Orban said he hopes the
industrial manufacturing sector, which represents close to a
third of the economy, will return to its pre-crisis expansion
rate from June.
    Hungary's economy could accelerate in the second half and
reverse an expected overall 3% drop in GDP this year with a
growth of 4.8% in 2021, Finance Minister Mihaly Varga said in a
statement.
    Currencies in the region firmed or held stable. The Polish
zloty was up 0.26% and trading at 4.554 versus the
euro, while the Hungarian forint gained 0.17%, firming
to 353.700 versus the common currency.
    The Czech crown led gains, adding 0.58% to trade
at 27.460 against the euro. The crown has lost 7.4% of its value
versus the euro this year, the biggest loss among its regional
peers. 
    Central bank governor Jiri Rusnok said the Czech National
Bank is not in a situation that would warrant interventions
against the crown.
    Budapest's blue-chip index led gains, firming 1.28%
by 0806 GMT. Warsaw was up 0.85%, while Bucharest
 gained 0.75%. Prague's equities gained 0.52%. 

            CEE        SNAPSHOT    AT                         
            MARKETS               1006 CET            
                       CURRENCIE                              
                       S                              
                       Latest     Previous  Daily     Change
                       bid        close     change    in 2020
 Czech                   27.4600   27.6200    +0.58%    -7.39%
 crown                                                
 Hungary                353.7000  354.3000    +0.17%    -6.38%
 forint                                               
 Polish                   4.5540    4.5660    +0.26%    -6.53%
 zloty                                                
 Romanian                 4.8385    4.8375    -0.02%    -1.04%
 leu                                                  
 Croatian                 7.5720    7.5733    +0.02%    -1.67%
 kuna                                                 
 Serbian                117.5700  117.6200    +0.04%    +0.00%
 dinar                                                
 Note:      calculated from                 1800 CET          
 daily                                                
 change                                               
                                                              
                       Latest     Previous  Daily     Change
                                  close     change    in 2020
 Prague                   863.45  858.9600    +0.52%   -22.60%
 Budapest               34582.21  34144.57    +1.28%   -24.96%
 Warsaw                  1592.65   1579.16    +0.85%   -25.93%
 Bucharest               8204.46   8143.54    +0.75%   -17.77%
 Ljubljana                813.09    808.02    +0.63%   -12.18%
 Zagreb                  1551.74   1546.68    +0.33%   -23.08%
 Belgrade   <.BELEX15     668.10    662.11    +0.90%   -16.66%
            >                                         
 Sofia                    449.51    449.51    +0.00%   -20.88%
                                                              
                       Yield      Yield     Spread    Daily
                       (bid)      change    vs Bund   change
                                                      in
 Czech                                                spread
 Republic                                             
   2-year   <CZ2YT=RR     0.1760   -0.0210   +093bps     -1bps
            >                                         
   5-year   <CZ5YT=RR     0.3390    0.0230   +109bps     +3bps
            >                                         
   10-year  <CZ10YT=R     0.9080    0.1730   +145bps    +18bps
            R>                                        
 Poland                                                       
   2-year   <PL2YT=RR     0.4990   -0.0030   +125bps     +1bps
            >                                         
   5-year   <PL5YT=RR     0.8850   -0.0050   +163bps     +0bps
            >                                         
   10-year  <PL10YT=R     1.2620   -0.0090   +180bps     -1bps
            R>                                        
            FORWARD                                           
                       3x6        6x9       9x12      3M
                                                      interban
                                                      k
 Czech Rep          <       0.19      0.18      0.21      0.35
            PRIBOR=>                                  
 Hungary            <       0.93      0.90      0.86      1.05
            BUBOR=>                                   
 Poland             <       0.32      0.28      0.29      0.68
            WIBOR=>                                   
 Note: FRA  are for ask prices                                
 quotes                                               
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 (Editing by Devika Syamnath)
  
 
 
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