CEE MARKETS-Zloty, forint hover near recent highs; CEZ shares shed gains

OMV Petrom SA

27/06/2023 10:33

By Jason Hovet
       PRAGUE, June 27 (Reuters) - Poland's zloty hovered near a
2-1/2-year high against the euro on Tuesday, keeping the unit on
track for its best quarter in more than a decade, while the Hungarian
forint also strengthened to trade near recent peaks.
    On stock markets, majority state-owned Czech utility CEZ
 CEZP.PR  shed gains earned after shareholders approved a record
dividend late on Monday.
    While currencies have mostly traded firmer this month with
interest rates still high, moves have been gradual as analysts say
markets are looking for a bigger impulse. Stagnation or even
correction could also be close, some say.
    "The sentiment is pro-zloty and the EUR/PLN exchange rate, which
has been in a strong downward trend for two months, is failing to
generate even a temporary correction," Bank Millennium said. 
    "On macroeconomic grounds, however, we do not believe that the
Polish currency still has reasons for appreciation in the short
term."
    The zloty  EURPLN=  had inched 0.2% higher to 4.43 to the euro by
0903 GMT, short of its peak of 4.421 touched earlier in June. 
    Central Europe's economies have been hit by sticky inflation -
running still at double-digit rates - that have frozen consumer
activity and hurt demand from manufacturers. 
    Investors are betting central banks will begin cutting interest
rates later this year, while Hungary's rate setters have already
started easing.
    
    
    In Hungary, the forint  EURHUF=  edged back towards the
368-per-euro level it scaled earlier this month when it hit a
14-month high.
    With markets calmer, one trader said the forint's high carry -
helped by Hungarian interest rates being the highest in the European
Union - would keep the currency in place for some time.
    "This week has been unusually calm this time of the year, due to
an increased predictability of the environment: we know what the U.S.
Fed and the ECB will do (on monetary policy), the Russian coup
attempt came and went," the trader said.
    Elsewhere, the Czech crown  EURCZK=  was up 0.05% at 23.692 to
the euro, somewhere in between a 15-year high of 23.233 hit in April
and a 12-week low of 23.917 touched two weeks ago.
    CEZ shares were down around 1% at 1,035 crowns, giving up early
gains of 1%, after shareholders backed a government-proposed dividend
of 145 crowns a share, implying a double-digit yield.
    The dividend overrode a management proposal of 117 crowns as the
state looks for more budget revenue to rein in fast-rising deficits.
    Shares have drifted in a tight range since May, with investors
waiting for news on a possible restructuring the government has
flagged.
    "There is no buying appetite," Komercni Banka analyst Bohumil
Trampota said. "Foreign investors ... rather pick something else. No
one likes uncertainty, especially not investors."
    
                     CEE MARKETS  SNAPSHO   AT                       
                                  T        1103              
                                           CET               
                                  CURRENC                            
                                  IES                        
                                  Latest   Previou  Daily    Change
                                           s                 
                                  bid      close    change   in 2023
 EURCZK  Czech        EURCZK=     23.6290  23.6400   +0.05%    +2.24%
 =       crown                                               
 EURHUF  Hungary      EURHUF=     368.950  369.100   +0.04%    +8.26%
 =       forint                         0        0           
 EURPLN  Polish       EURPLN=      4.4300   4.4385   +0.19%    +5.86%
 =       zloty                                               
 EURRON  Romanian     EURRON=      4.9600   4.9564   -0.07%    -0.35%
 =       leu                                                 
 EURRSD  Serbian      EURRSD=     117.180  117.280   +0.09%    +0.10%
 =       dinar                          0        0           
         Note:       calculated                     1800             
         daily       from                           CET      
         change                                              
                                                                     
                                  Latest   Previou  Daily    Change
                                           s                 
                                           close    change   in 2023
 .PX     Prague       .PX         1299.17  1302.34   -0.24%    +8.11%
                                                00           
 .BUX    Budapest     .BUX        49951.8  50087.4   -0.27%   +14.06%
                                        4        1           
 .WIG20  Warsaw       .WIG20      2059.01  2068.49   -0.46%   +14.90%
 .BETI   Bucharest    .BETI       12018.0  11956.9   +0.51%    +3.04%
                                        0        5           
                                                                     
                                                    Spread   Daily
                                                    vs Bund  change
                                                             in
         Czech                                               spread
         Republic                                            
 CZ2YT=    2-year     CZ2YT=RR     5.7390  -0.0820   +259bp     -9bps
 RR                                                       s  
 CZ5YT=    5-year     CZ5YT=RR     4.7740  -0.0270   +230bp     -4bps
 RR                                                       s  
 CZ10YT    10-year    CZ10YT=RR    4.2410  -0.0550   +193bp     -6bps
 =RR                                                      s  
         Poland                                                      
 PL2YT=    2-year     PL2YT=RR     5.8180  -0.0160   +267bp     -2bps
 RR                                                       s  
 PL5YT=    5-year     PL5YT=RR     5.6480  -0.0080   +317bp     -2bps
 RR                                                       s  
 PL10YT    10-year    PL10YT=RR    5.7950   0.0150   +349bp     +1bps
 =RR                                                      s  
                     FORWARD                                         
                                  3x6      6x9      9x12     3M
                                                             interban
                                                             k
         Czech Rep    CZKFRA                                   
         Hungary      HUFFRA                                    
         Poland       PLNFRA                                    
         Note: FRA   are for ask                                     
         quotes      prices                                  
         *****************************************                   
         *********************                               
                                                                     
 
    

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Polish zloty    https://tmsnrt.rs/44mh5sq
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Jason Hovet in Prague, Karol Badohal in Warsaw and
Boldizsar Gyori in Budapest; Editing by Sherry Jacob-Phillips)
 ((jason.hovet@thomsonreuters.com))
 
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