Although the BUX index has risen substantially over the past month, an increasing number of fund managers polled by Portfolio.hu formulated a more optimistic view on the prospects of the Budapest Stock Exchange (BSE) than in the previous monthly survey. Subsequently, stocks that have been preferred thanks to their defensive nature have garnered fewer mentions as top picks, while riskier papers that respond more to shifts in global sentiment have become more alluring than they were in early March.
The contributors to the poll were: Aegon, Axa, Buda-Cash, Budapest Fund Management, Citadella Consulting, Concorde, Dialóg, Equilor, Erste, Generali, ING, K&H, MKB, OTP, Pioneer, QUAESTOR, Raiffeisen, RCM.
The steep descent the Budapest Stock Exchange (BSE) has been on since the beginning of the year has not only levelled out in March but turned into a dynamic uphill gallop. The analyst forecasts churning in, however, showed a divide on the market about the likely duration of the bear rally. By the end of March, though stronger technical barriers were reached and only a handful of macro releases pained a better-than-expected picture of the world economy.
The fund managers polled by Portfolio.hu are nevertheless more upbeat about the BSE's prospects than a month ago. Most of them project the BUX index to shift +/-5% in the following three-month period. At the same time more of the respondents forecast an even bigger rise in the index than in March.
Regarding 3-m estimates it was obvious already in February that an increasing number of the fund managers started to look into the future with higher hopes and the share price changes since then have proved them right. Their shift towards elation is reflected also in the projections for the following 12 months, on which horizon the majority expects a 5-15% rise in the BUX index. There are still some who forecast an even brighter future for the Budapest bourse.
The aggregate data demonstrate the swing of the fund managers into the bright side regarding the likely global and local investor sentiment. This is also underpinned by the fact that more fund managers named OTP and MOL as their top pick than a month ago, while Richter and Magyar Telekom, which tend to be classified as defensive stocks, have lost some of their appeal.
Magyar Telekom remained the most attractive stock on the BSE for the respondents. The company will pay HUF 74 dividend per share on its 2008 profit. The paper always rose before payout day in the past years and end-April (when MTel will make dividend payment) is drawing closer.
Hungary's leading drugs producer Richter has not only seen its role diminish in the BUX index but also its lustre fade among fund managers. It was mentioned as a top pick only by two respondents this time.
The popularity of MOL has grown the most over the past month, after OMV sold its 21.2% package in the company to Russia's Surgutneftegas. The number of small caps is becoming smaller and smaller in the list of top picks. Only printing house Állami Nyomda managed to increase its appeal.
As an increasing number of fund managers turned more optimistic about stock prospects, the ratio of those overweighting the papers compared to their own benchmark has also grown. There was a pickup in this regard already in March, but then underweighters were still in a big majority. There is a tie in this respect now.
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