May 30, 2019 / 9:48 AM / 8 months ago

CEE MARKETS-Currencies regain ground as Czech utility CEZ extends gains

    PRAGUE, May 30 (Reuters) - Central European currencies
recovered some ground on Thursday, getting a reprieve from
recent weakness linked to global trade war worries, while shares
in Czech utility CEZ continued a two-day rally.
    CEZ shares extended gains after the company announced a
shift in strategy earlier this week to focus on the home market
and sell assets abroad, saying shareholders could see an
extraordinary dividend from the proceeds.
    Assets in the region have been weighed down by poor
international sentiment, including concerns about economic
growth in Europe and escalating trade tensions between the
United States and China.
    The Hungarian forint firmed on Thursday to lead
currency gains, rising 0.2% to 325.43 to the euro by 0845 GMT,
while Poland's zloty gained 0.1% to 4.292.
    "After a moment of weakness we now have a rebound, the zloty
is a bit stronger but really the market is stuck," said a
Warsaw-based currency dealer. "We are waiting for the GDP
numbers from the U.S. (on Thursday)."
    Analysts said markets could also take cues from GDP data
coming out in much of the region on Friday.
    The Czech crown has also been dragged down by
regional weakness, and is languishing close to a 3-1/2 month
low, deviating further from central bank assumptions of firming.
 
    The central bank has raised interest rates eight times since
2017 but signalled stability ahead after its last increase on
May 2, which has added to the crown's weakness. Some analysts
say a weaker crown could force the central bank into another
rate hike this year.
    The currency bid at 25.852 to the euro, up a touch on the
day. A trader said the 25.85 level could provide some resistance
to further weakening for now.    
    Meanwhile, stocks in Prague rose 0.3%, led by CEZ shares,
which were up 1.2% following Wednesday's 1.7% gain, their
biggest one-day increase so far this year. The company's shares
have fallen in the past year, unlike other utilities, hurt by
uncertainties such as plans over future nuclear power expansion.
    The company is retrenching further in the Czech market and
has said it could get "many tens of billions of crowns" from
divestments in foreign markets, adding that it would not be a
forced seller.
 
                     CEE       SNAPSHO   AT                      
                     MARKETS   T        1045              
                                        CET               
                               CURRENC                           
                               IES                        
                               Latest   Previou  Daily    Change
                                        s                 
                               bid      close    change   in 2019
 EURCZK=  Czech      <EURCZK=  25.8520  25.8580   +0.02%   -0.56%
          crown      >                                    
 EURHUF=  Hungary    <EURHUF=  325.430  326.185   +0.23%   -1.34%
          forint     >               0        0           
 EURPLN=  Polish     <EURPLN=   4.2920   4.2966   +0.11%   -0.06%
          zloty      >                                    
 EURRON=  Romanian   <EURRON=   4.7585   4.7598   +0.03%   -2.20%
          leu        >                                    
 EURHRK=  Croatian   <EURHRK=   7.4235   7.4225   -0.01%   -0.18%
          kuna       >                                    
 EURRSD=  Serbian    <EURRSD=  117.840  117.910   +0.06%   +0.39%
          dinar      >               0        0           
          Note:      calculated from             1800            
          daily                                  CET      
          change                                          
                                                                 
                               Latest   Previou  Daily    Change
                                        s                 
                                        close    change   in 2019
 .PX      Prague               1043.76  1040.51   +0.31%   +5.80%
                                             00           
 .BUX     Budapest             40965.0  40916.4   +0.12%   +4.67%
                                     6        2           
 .WIG20   Warsaw               2212.17  2187.45   +1.13%   -2.83%
 .BETI    Bucharest            8392.22  8476.39   -0.99%   +13.66
                                                                %
 .SBITOP  Ljubljana  <.SBITOP   881.37   878.31   +0.35%   +9.59%
                     >                                    
 .CRBEX   Zagreb               1865.12  1862.47   +0.14%   +6.65%
 .BELEX1  Belgrade   <.BELEX1   731.44   732.05   -0.08%   -3.97%
 5                   5>                                   
 .SOFIX   Sofia                 573.14   572.56   +0.10%   -3.59%
   

 (Reporting by Reuters bureaus
Writing by Jason Hovet
Editing by Helen Popper)
  
 
 
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