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Oil stocks fall, no lift for currencies from hawkish hints


Reuters

By Sandor Peto

BUDAPEST, Nov 15 (Reuters) - Energy, crude and metals sector stocks knocked Central European equities lower on Wednesday after a continuing decline in crude prices caused similar movements in Wall Street and elsewhere in the world.

Warsaw's bluechip index led the decline, shedding 0.6 percent by 0933 GMT.

Global weakness in equities has weighed on stocks across the region this week even though a batch of third-quarter data early on Tuesday showed robust economic growth in Central Europe.

Regional currencies have also not benefited from the figures because a surge in German output has triggered euro buying.

Hawkish comments from a Polish and a Czech central banker, quoted by local papers on Wednesday, had no effect either.

Czech central bank (CNB) Vice-Governor Mojmir Hampl said he may vote for a 25 basis point interest rate hike at the next policy meeting on Dec. 21. That would be the third hike since August when the bank started to reverse years of easing.

The Czech crown eased a quarter of a percentage point against the euro to 25.695 despite the comments.

Keeping rate hike expectations alive is a key tool of the CNB to buoy the crown, whose strength helps it fight inflation which has exceeded its 2 percent target.

The zloty eased even though Polish rate setter Lukasz Hardt was quoted by the daily Rzeczpospolita as saying he may consider a small rate hike early next year if inflation is still heading towards the bank's 2.5 percent target.

Polish government bonds tracked a retreat in yields in the main developed markets, with the 10-year yield dropping 3 basis points to 3.416 percent.

Romania's corresponding yield was 4.62 percent, flat after a recent surge in the country's yields to their highest levels since 2014. The leu firmed 0.1 percent to 4.636 versus the euro.

Tuesday's data showed Romania growing faster in the third quarter than any of its central European peers, at 8.8 percent. That figure and higher-than expected inflation data have underlined fears that the economy is overheating.

"Some market watchers may see the rising pressure on the regulator (Romanian central bank) to deliver a faster policy response (monetary tightening) amid the increased risk of falling 'behind the curve'," Raiffeisen analyst Gintaras Shlizhyus said in a note.

CEE MARKETS

SNAPSHOT

AT 1033 CET

CURRENCIES

Latest

Previous

Daily

Change

bid

close

change

in 2017

Czech crown

25.6950

25.6295

-0.25%

5.11%

Hungary forint

311.8000

311.7650

-0.01%

-0.96%

Polish zloty

4.2495

4.2482

-0.03%

3.63%

Romanian leu

4.6360

4.6417

+0.12%

-2.18%

Croatian kuna

7.5505

7.5533

+0.04%

0.06%

Serbian dinar

118.4300

118.5400

+0.09%

4.15%

Note: daily change

calculated from

previous

close at

1800 CET

STOCKS

Latest

Previous

Daily

Change

close

change

in 2017

Prague

1060.19

1062.45

-0.21%

+15.04%

Budapest

39020.91

39140.44

-0.31%

+21.93%

Warsaw

2448.79

2464.35

-0.63%

+25.71%

Bucharest

7798.84

7804.73

-0.08%

+10.07%

Ljubljana

786.38

789.08

-0.34%

+9.59%

Zagreb

1843.16

1842.63

+0.03%

-7.60%

Belgrade

738.51

739.05

-0.07%

+2.95%

Sofia

671.57

670.66

+0.14%

+14.52%

BONDS

Yield

Yield

Spread

Daily

(bid)

change

vs Bund

change in

Czech Republic

spread

2-year

0.473

0.141

+123bps

+15bps

5-year

0.917

0.092

+127bps

+11bps

10-year

1.713

-0.033

+134bps

-1bps

Poland

2-year

1.593

-0.004

+235bps

+1bps

5-year

2.585

-0.036

+294bps

-2bps

10-year

3.425

-0.032

+305bps

-1bps

FORWARD

RATE

AGREEMENT

3x6

6x9

9x12

3M interbank

Czech Rep

0.95

1.11

1.22

0

Hungary

0.03

0.1

0.15

0.03

Poland

1.775

1.805

1.915

1.73

Note: FRA quotes

are for ask prices

**************************************************************




This article appears in: Politics , Stocks , World Markets


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