Serious Rally at the Budapest Stock Exchange This Week

The Budapest Stock Exchange (BSE) closed a strong week with significant, active trading following the parliamentary elections: the BUX index rose 4.46% to a new level, while all leading stocks gained ground and trading volume surged dramatically compared to the previous week.

On Friday, the BUX closed at 138,813.03 points, up 4.46%, or 5,929.8 points from the previous week’s closing value. Total trading volume on the exchange was HUF 336.2 billion, up from HUF 174.3 billion the previous week.

In his assessment summarizing the week’s events, Zoltán Varga, chief analyst at Equilor Investment Ltd., highlighted the announcements made by the prime ministerial candidate Péter Magyar at his international press conference among the post-election developments. Péter Magyar stated that bringing home EUR 20 billion in frozen EU funds is among the government’s priorities.

He stated that central bank independence is important, and as long as the National Bank of Hungary (MNB) fulfills its price stability mandate effectively, he sees no reason why the MNB governor Mihály Varga should step down. Regarding the adoption of the euro, Péter Magyar said that a target date will soon be set for meeting the Maastricht criteria.

According to S&P’s expectations, the new government may also be able to release frozen EU funds; however, from a credit rating perspective, the presentation of budget plans and improvements in the efficiency of government operations will be crucial. According to the credit rating agency’s assessment, the situation in the Middle East is putting pressure on the Hungarian economy through both the current account and the budget, the Equilor chief analyst added.