The PX-50 index gained 0.85% on lower turnover again with the two banking names under the spotlight. Komercni banka closed flat despite larger than average volume but our feeling suggests that a selling appetite is prevailing. Komercni banka lacks any near-term catalyst and we think most of the longs were based on the expectation of a positive response to the stellar Q3 results from OTP and the successful debut of PKO BO Poland. When both events occurred KB failed to react. Erste Bank was in high demand; we continue to see large accounts stepping into both the Czech as well as Austrian traded lines. Erste gained 2% on Prague, a combination of both a brokerage upgrade and the expectation of strong results due this morning were the main growth engines. CEZ broke through a new record high of CZK 300; we believe this will be key level of resistance. In the short term we are not too convinced about a further sharp upward move in the stock. Cesky telecom continues in its emotionless trading, with the market awaiting the government announcement on the timing of its offering. We may possibly hear more details on Monday, November 15 when the Cabinet meets. Volume in the SPAD reached USD 77.32m.
Milan Procházka, Patria Finance