EME Equity Market – February 2024 Market performance – a positive February, with the Polish WIG20 outperforming. The MSCI EM Europe Index added 4.2% mom in EUR terms and 3.7% mom in USD in February. The Polish WIG20 saw the strongest performance, adding 6.4% mom in EUR terms, followed by the Greek ASE (+4.2% mom), the Turkish ISE30 (+4.0% mom) and the Romanian BET (+2.6% mom) (all in EUR terms). There was a relatively muted performance in Hungary (+0.6% mom in EUR terms) and a decline in the Cze...
HEADLINES: • Hidroelectrica: incorporating lower power prices (downgraded to HOLD) • MONETA Money Bank: publishes 4Q23 results, guides for CZK 9 of 2023 DPS, upgrades 2024-28E EPS guidance NEUTRAL • Akbank: 4Q23 results and 2024E guidance highlights Kazatomprom: 4Q operational update and guidance NEUTRAL • OMV Petrom: takeaways from the 4Q23 earnings call NEUTRAL • BRD-GSG: SocGen may be mulling over potential sale of its Romanian subsidiary NEUTRAL • Kruk: invests EUR 212m in 1Q24E in Italy,...
A volatile week for EM amid renewed sharp moves in the UST market, although spread levels in general held up relatively well. With focus returning to the US banking sector and uncertainty remaining around the path of the Fed, we expect macro volatility to continue to drive returns for EM credit and should see increased dispersion across names.
EME Equity Market – October 2023 Market performance – election results prompt stellar market reaction in Poland; sell-off in Turkey. The MSCI EM Europe Index added 1.7% mom in EUR terms and 2.0% mom in USD in October. Poland staged a massive rebound, post the elections, with the WIG20 advancing 16.4% mom in EUR terms. Apart from Turkey, where October was a sell-off, with the ISE30 declining 13.7% mom in EUR terms, there were relatively muted performances everywhere else (BUX +2.1% / PX +0.4% / B...
HEADLINES: • Bank of Cyprus: tightening triumph (BUY - transfer of coverage) • Bank Millennium: solid capital ratio progress and manages to book some headline net profit in 3Q23 NEUTRAL • Akbank: 3Q23 highlights - revenue strength POSITIVE • Turkey macro: CBT heading towards ex-ante positive real rate • Shoper: earnings call takeaways - headcount to rise 9% qoq in 4Q23E NEUTRAL • Romania macro: President promulgates draft law on fiscal package NEUTRAL • Colt CZ Group SE: acquires minority sta...
We anticipate that the relaxation of the regulatory framework and a return to more conventional policies will positively impact the banking sector. TL commercial loan/deposit spreads (front book), which had plummeted to as low as -18% by the end of June, have reached 6.6%, thanks to the removal of a cap on lending rates and lower deposit rates. Taking these favourable developments and strong 2Q23 results into account, we are raising our aggregate FY23 NI estimate for the sector by 10%. We now fo...
EME Equity Market – July 2023 Market performance – gains keep on rolling in all geographies, with special mention of Turkey’s stellar performance. The MSCI EM Europe Index gained 8.6% mom in EUR terms and 9.5% mom in USD in July. Turkey clearly outperformed its peers, gaining 18.6% mom in EUR terms. Most other geographies performed more or less at similar levels, with the Polish WIG20 in the upper part of the range, advancing 7.3% mom in EUR terms, followed by the Romanian BET and Czech PX indic...
With the key central bank meetings out of the way without any major hiccups, we expect the summer lull to start to set in for EM credit markets. However, with spread levels looking tight, investors will be on the lookout for further signs of intrenched inflation or weakness in the global economy, along with expectations for an uptick in supply from September.
HEADLINES: • OMV Petrom: awaiting the special dividend (stays BUY) • OMV Petrom: Executive Board proposes RON 0.045 special dividend • MONETA Money Bank: posts solid 2Q23 results and tweaks guidance up, mostly on lower CIT NEUTRAL • Akbank: 2Q23 - similar trends vs. Yapi Kredi and trading income makes up 50% of 2Q23 revenues • Tofas: strong beat in 2Q23 results, domestic sales guidance raised POSITIVE • Jeronimo Martins: 2Q23 EBITDA spot on expectations NEUTRAL • Otokar: 2Q23 results - improv...
Including Alarko Holding to our model portfolio, while removing Akbank: We are including Alarko Holding to our model portfolio while excluding Akbank . Alarko Holding shares have underperformed the BIST-100 by 17% and 33% in USD terms YTD. Following the tangible weakness in the shares, we believe the following factors could offer relative protection against potential volatility in the broader market: 1) Relatively defensive nature of its current NAV given the high weight of electricity generat...
While key central bank meetings passed this week without any major upset, the short-term outlook for EM is likely to be driven by global risk factors such as US banking system concerns and the debt ceiling. Spread widening could open up value given expectations for a more supportive medium-term backdrop.
EME Equity Market – April 2023 Market performance – in the black across all geographies, except for Turkey. The MSCI EM Europe Index gained 3.4% mom in EUR terms and 4.9% mom in USD in April. The Polish WIG20 Index saw the biggest gains (+11.5% mom in EUR terms), followed by the Hungarian BUX Index (+7.8% mom in EUR terms) and the Greek ASE Index (+2.9% mom in EUR terms). More muted performances were witnessed in the Czech PX Index and Romanian BET Index, both adding 1.7% mom in EUR terms for th...
HEADLINES: • Bank Pekao: 1Q23 results beat expectations by 12%, solidifying our positive view on the stock POSITIVE • MONETA Money Bank: solid beat vs. 1Q23 forecasts, bodes well for FY guidance POSITIVE • Kruk: posts solid 1Q23 results, implying management is betting even more on Italy and Spain NEUTRAL • LPP: 4Q22 below expectations on weaker sales; decent start to the year, bullish guidance for FY23E POSITIVE • Shoper: 1Q23 results broadly in line with our and the market's expectations NEUTRA...
With signs of some stabilisation in global markets, EM credit performed well this week. We see potential for the positive momentum to be sustained in the near term, with spreads still at elevated levels and EM nations largely insulated from recent banking stresses.
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