Analysis: In May 2007 Kazakhstan market had throw of from itself the speculative re-sold of dollar

/IRBIS, Sergey Yakovlev, Andrey Tsalyuk, June 8, 07/ - In May of 2007 volume of operations with foreign currency on Kazakhstan stock exchange (KASE) made the equivalent of USD7,130.3 m. or KZT858,102.5 m. It is the largest monthly turnover of foreign currency on KASE in the current year. For the whole history of exchange the monthly turnover in dollar equivalent was higher only in November 2006. Relative to April of 2007 volume of deals in May has increased by $1,233.8 m. (KZT138,591.5 m.) or by 20.8% (19.3%). Relative to May of 2006 volume of trades has increased 2.8 times in dollar and 2.8 times in tenge equivalent. Stake of this sector in exchange turnover has increased from 23.7% in April to 28.7% in May 2007. In all, in May 2007 on KASE 5,640 (5,680) deals were concluded (here and hereinafter corresponding indicator of the previous month is given in parentheses), including: in US dollar on TOD terms - 5,091 (5.507), on TOM terms - 500 (145); on SPOT terms - 29 (13); in euro - 0 (0), in Russian ruble - 20 (15). In the total turnover of exchange currency market in May 2007 99.96% of the total volume of concluded deals accounted for US dollar. Corresponding indicator of the previous month - 99.98%. In May morning (main) session controlled 42.1% (46.7%) of exchange's turnover of currency market. To the stake of day session came 40.2% (43.5%), evening session - 17.7% (9.8%).. On US dollar volume of operations on KASE in May totaled $7,127.7 m. (KZT857,797. m.). For comparison, in April 2007 this indicator totaled $5,895.5 m. (KZT719,393.3 m.), in May 2006 - $2,539.0 m. (KZT310,989.9 m.). In May 2007 tenge to dollar devaluated with rate 22.7% APR. Last month tenge was strengthening to dollar. Average arte of this process made 36.7% APR. Weighted average US dollar rate to tenge, calculated on deals of the primary session of May 2007 - KZT120.33 per a unit, on all exchange deals - KZT120.35. For April 2007 corresponding indicators totaled KZT121.83 and KZT122.02 per a dollar. On euro in May deals on KASE were not concluded. The last deal with this currency on KASE was conducted on January 24, 2006, although this sector is available for participants every day. In Russian ruble volume of operations on KASE in May 2007 made 65,300 th. rubles for a total of KZT305.5 m. (in April the volume of transactions totaled 24,900 th. rubles for a total of KZT117.6m.). Judging on the change of the weighted average exchange rate (April 30, 07 = 4.6710; May 31, 07 = 4.7090), in the analyzed month tenge to ruble had devaluated with average rate 9.58% APR. It should be noted that /may events in the analyzed sector of market were extremely exactly forecasted by specialists of IRBIS a month ago. May had become the crucial for local dollar market. After fast strengthening of tenge caused by speculations of banks on the background of some deficit of liquidity, which appeared due to conduction of budget payments, market of dollar had boldly turned upward. During whole May it had worked the well expressed correction. It happened without direct participation of National bank on exchange market, despite the record high announced volume of convertation of tenge account of National fund. However the position of head bank on currency market of the country in May was felt. In other case it is impossible to explain the confidence with which traders played upward.. By opinion of analysts of IRBIS the particular mite to forming of described market conjuncture was contributed by maturity of last issue of international bonds of sovereign debt of Kazakhstan for amount of $350 m. The maturity had passed calmly, but had influenced the market psychologically. Which had the right to wait for growth of demand for American currency inside of country.. Judging by beginning of July, not any shocks IRBIS forecast this month. Most likely, the market will consolidate near the value 121.50 and will try to live in wide subhorizontal channel with very moderate volumes of operations. At that strengthening of tenge seems more likely than of dollar. [2007-06-08]