OTP Leads Stocks to 7-Week High on Budget Deal: Budapest Mover
OTP Bank Nyrt. (OTP), Hungary’s largest lender, led the nation’s benchmark stock index (MXEF) to the highest level in almost seven weeks after U.S. lawmakers resolved a budget deadlock threatening the world’s largest economy.
OTP’s shares jumped 2.7 percent to 4,260 forint by the close in Budapest, the biggest advance since Nov. 30. The BUX index, in which OTP has a 31 percent weighting, rose 1.7 percent to 18,487.51, the highest since Nov. 15.
The MSCI Emerging Markets Index soared 2.1 percent, the most since September, after the House of Representatives voted in favor of budget legislation averting spending cuts and tax increases that had threatened to crimp growth. Hungary’s manufacturing sector returned to contraction in December, a purchasing manager index showed today, the latest signal that the economy failed to emerge from recession last year.
“The key point is that the deal has been clinched and the tightening measures which could have pulled the U.S. economy into recession don’t enter into force,” Akos Kuti, a Budapest- based analyst at broker Equilor Befektetesi Zrt., wrote in a report today.
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