CEE MARKETS-Assets mixed on trade war fears, Hungary slowdown

    By Marton Dunai
    BUDAPEST, Aug 7 (Reuters) - Emerging European stocks gained
on Wednesday benefiting from a Western European rebound but
currencies traded flat, as lingering worries about the Sino-U.S.
trade war and signs of a slowdown in Hungary weighed on markets.
    Shares in Asia fell for an eighth straight session on
Wednesday, but losses and nerves were soothed somewhat by White
House assurances that it wants to press ahead with negotiations.

    European shares rose on Wednesday after three sessions of
losses as deal-making activity in the chemical sector helped
offset pale earnings from banks in the region.
    Hungarian, Czech and Polish assets mostly treaded water in
early trading, as investors waited for cues from any change in
risk appetite in core markets.
    The zloty may follow a lacklustre session on Tuesday with
some strengthening, Santander said in a note to clients.
    "As long as there is no information fuelling the risk
aversion, in our view the zloty could gain and catch up with
other currencies of our region"    
    In Hungary, weaker than expected industry output data added
to recent signs of an economic slowdown, something Prime
Minister Viktor Orban has said may prompt several new stimulus
    June output showed contraction both on a monthly and an
annual basis.
    "Today's data rounds out the second-quarter figures which
shows the slowing of overall growth together with retail sales
data," ING analyst Peter Virovacz wrote in a note. "All signs
indicate the first quarter was the peak and the economy is
slowing down now."
    Hungary's economic growth tied a 19-year high of 5.3%
year-on-year in the first quarter.
    Aside from economic challenges, the region also faces
political changes later this year, with general elections in
Poland and a municipal vote in Hungary.
    The Polish president's office has confirmed the country will
hold its parliamentary election on Oct. 13, which most pollsters
expect the ruling Law and Justice (PiS) party to win thanks to
generous social spending and robust economic growth.
    Hungary will hold municipal elections on the same day,
watched more closely than normal for signs of any change in the
overwhelming dominance of Prime Minister Viktor Orban's Fidesz
party, unbroken for more than a decade.

            CEE        SNAPSHOT   AT                         
            MARKETS              0955 CET            
                       Latest    Previous  Daily     Change
                       bid       close     change    in 2019
 Czech                  25.7450   25.7410    -0.02%    -0.15%
 Hungary               325.3800  325.0200    -0.11%    -1.32%
 Polish                  4.3175    4.3166    -0.02%    -0.65%
 Romanian                4.7310    4.7299    -0.02%    -1.63%
 Croatian                7.3810    7.3825    +0.02%    +0.39%
 Serbian               117.5900  117.6500    +0.05%    +0.60%
 Note:      calculated from                1800 CET          
                       Latest    Previous  Daily     Change
                                 close     change    in 2019
 Prague                 1026.22  1022.850    +0.33%    +4.02%
 Budapest              40323.44  40037.39    +0.71%    +3.03%
 Warsaw                 2170.60   2156.23    +0.67%    -4.66%
 Bucharest              9103.70   9047.79    +0.62%   +23.29%
 Ljubljana               858.12    868.21    -1.16%    +6.70%
 Zagreb                 1900.49   1897.97    +0.13%    +8.67%
 Belgrade   <.BELEX15    764.90    763.78    +0.15%    +0.42%
 Sofia                   579.64    579.95    -0.05%    -2.49%
                       Yield     Yield     Spread    Daily
                       (bid)     change    vs Bund   change
 Czech                                               spread
   2-year   <CZ2YT=RR    1.1590    0.1740   +199bps    +18bps
   5-year   <CZ5YT=RR    0.9760    0.0470   +179bps     +6bps
   10-year  <CZ10YT=R    1.0360   -0.0090   +159bps     +1bps
   2-year   <PL2YT=RR    1.5600   -0.0010   +239bps     +1bps
   5-year   <PL5YT=RR    1.8400   -0.0120   +265bps     +0bps
   10-year  <PL10YT=R    2.0890    0.0000   +265bps     +2bps
            FORWARD    RATE      AGREEMEN                    
                       3x6       6x9       9x12      3M
 Czech Rep          <      2.09      1.92      1.76      2.15
 Hungary            <      0.31      0.33      0.36      0.26
 Poland             <      1.73      1.72      1.70      1.72
 Note: FRA  are for ask prices                               

 (Reporting by Marton Dunai
Editing by Alexandra Hudson)

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