By Anita Komuves BUDAPEST, March 20 (Reuters) - Central European stock indexes rebounded and currencies firmed on Friday as regional governments and central banks announced measures to keep economies afloat during border closures and major disruptions in business activity. "Despite negative signals from Italy, where the number of deaths due to the coronavirus pandemic exceeded the number of deaths in China, Friday brings stabilization of sentiment in the financial markets," Bank Millenium said in a note. Regional currencies jumped on Friday after most of them plunged and some hit fresh record lows the day before. The Hungarian forint, the Czech crown and the Polish zloty are all down around 6% this year. The Czech crown led gains in the region, it was up 2.67% on the day and was trading at 26.950 to the euro, as of 0958 GMT. The crown is still at five-year lows, at a level where the currency traded between 2013 and 2017, when the Czech central bank was pursuing a policy of intervention to keep it weak. "After correction on EURCZK, there is no interest to trade now," a Prague-based dealer said. Activity is still low, which exaggerates moves and the market is "tired," he added. The forint was up 2.22% on the day and traded at 350.20 to the euro. The currency hit a new record low of 359.50 to the euro on Thursday. The Romanian leu was up 0.11% and was trading at 4.845 to the euro. The leu also fell to new lows on Thursday, and leading the central bank to step into the foreign exchange market on Thursday, according to dealers. Regional stock indexes surged on Friday after steep losses at the beginning of the week. Budapest's equities led the gains with 5.54%, with oil and gas group MOL shares soaring almost 15% on a rise in oil prices and investor hopes for stimulus measures worldwide. Oil prices rose on Friday as the world's richest nations poured unprecedented aid into the global economy to stop a coronavirus-driven recession and U.S. President Donald Trump hinted he may intervene in the price war between Saudi Arabia and Russia. Prague and Warsaw also strengthened by about 5%. Bucharest's stocks gained 2.54%. Governments and central banks across the region took turns announcing emergency steps to help their economies that are set to be hit by the disruptions to business and daily life being felt around the world as governments seek to contain the spread of the new coronavirus that has infected more than 200,000 worldwide. Hungary's finance minister said on Thursday that the economy will recover from the blow it suffered from the coronavirus pandemic only very slowly and the ship has sailed for the economy this year. The Czech and Polish central banks have delivered rate cuts and Hungary's central bank on Thursday detailed more help to banks, after a blanket moratorium on all household and business loans imposed by the government until the end of this year. On bond markets, Poland's central bank bought back bonds worth 2.66 billion zloty ($630.35 million) as part of a new program. Polish rate-setters sent mixed messages on Friday about the possibility of new rate cuts: Lukasz Hardt was quoted saying that there is no need to cut interest rates further, while Grazyna Ancyparowicz sees a possibility of another interest rate cut. The Polish Finance Ministry on Thursday decided to lift the systemic buffer for banks, in a move that will free up 30 billion zloty of fresh capital that may be spent on financing businesses at the time of coronavirus epidemic. CEE SNAPSHOT AT MARKETS 1058 CET CURRENCIE S Latest Previous Daily Change bid close change in 2020 Czech 26.9500 27.6690 +2.67% -5.63% crown Hungary 350.2000 357.9700 +2.22% -5.44% forint Polish 4.5436 4.5633 +0.43% -6.32% zloty Romanian 4.8455 4.8510 +0.11% -1.18% leu Croatian 7.6080 7.6145 +0.09% -2.14% kuna Serbian 117.4600 117.5400 +0.07% +0.09% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2020 Prague 746.31 709.1500 +5.24% -33.10% Budapest 31128.34 29494.19 +5.54% -32.45% Warsaw 1541.37 1469.43 +4.90% -28.31% Bucharest 7572.35 7384.75 +2.54% -24.10% Ljubljana 716.96 702.12 +2.11% -22.56% Zagreb 1416.88 1373.50 +3.16% -29.77% Belgrade <.BELEX15 612.91 620.73 -1.26% -23.55% > Sofia 414.85 405.80 +2.23% -26.98% Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.4180 0.0350 +206bps +2bps > 5-year <CZ5YT=RR 1.5400 0.0510 +197bps +9bps > 10-year <CZ10YT=R 1.7350 0.0000 +199bps +9bps R> Poland 2-year <PL2YT=RR 1.2720 0.0470 +191bps +3bps > 5-year <PL5YT=RR 1.7090 -0.0490 +214bps -2bps > 10-year <PL10YT=R 2.1290 -0.0570 +239bps +3bps R> FORWARD 3x6 6x9 9x12 3M interban k Czech Rep < 0.78 0.42 0.36 1.80 PRIBOR=> Hungary < 0.53 0.52 0.52 0.61 BUBOR=> Poland < 0.72 0.67 0.65 1.19 WIBOR=> Note: FRA are for ask prices quotes *************************************************** *********** (Additional reporting by Jason Hovet in Prague and Alan Charlish in Warsaw, Editing by Sherry Jacob-Phillips)
Source: Read Full Article