CEE MARKETS-Leu leads currency firming, stocks mostly ease
* Leu leads rise as CEE currencies set or test multi-week highs * Hopes help leu for end of uncertainty over bank tax * Local factors move stock indexes rather than global gloom (Recasts with Romanian finance minister comments and leu surge, comments from Hungarian Prime Minister Orban and dealer) By Sandor Peto and Alan Charlish BUDAPEST/WARSAW, Feb 27 (Reuters) - The leu led Central European currencies higher on Wednesday after Romanian Finance Minister Eugen Teodorovici pledged to end uncertainty over a bank tax.
Regional currencies were helped by a weaker dollar, hawkish central bank comments from Budapest and hopes that Britain will not quit the European Union without a deal.
The Romanian leu touched a two-week high at 4.732 against the euro, before retreating to 4.7415 by 1421 GMT, still up by 0.4 percent.
A new tax effective this year would exempt several types of financial assets, Teodorovici said ahead of a meeting with banks, which he said could dispel fears and uncertainty.
Banca Transilvania shares still fell by 3.8 percent after the lender reported a modest rise in 2018 profits. .
Its fall was the main cause of a 1.1 percent decline in Bucharest's bluechip stock index.
The region's stock indexes were driven by local factors.
Prague's index rose by 0.2 percent, lifted by 1.5 percent rise in the shares of MONETA after Home Credit Group pulled out of a deal to sell its Czech and Slovak businesses to the Czech bank.
Budapest's main index fell as OTP Bank struggled to break through a technical resistance level at 11,850 forints ($42.68) for the third day, ahead of the release of its fourth-quarter earnings on Friday.
Regional government bond markets were steady, eyeing comments from Prime Minister Viktor Orban and the central bank that in the longer term all Hungarian state debt should be held by domestic investors.
Foreign investors currently hold 4.24 trillion forints ($15.28 billion) worth of forint-denominated government bonds, about a third of such papers, and most of Hungary's foreign currency bonds worth about 4.9 trillion forints.
The forint hits its strongest level since Feb. 1 at 316.16 versus the euro. At 1421 GMT it traded at 316.34, still up 0.1 percent, while the zloty firmed 0.2 percent to 4.316.
They were buoyed by a weakening of the dollar after Federal Reserve Chair Jerome Powell on Tuesday stuck to the central bank's "patient" stance on further interest rate increases.
"Direction of flows changed on Monday. London banks, responsible for EURPLN buying for last 2 weeks, have been on the offer," one Warsaw-based dealer said, adding that hopes for a delay in Brexit and profit taking helped.
CEE SNAPSHOT AT MARKETS 1521 CET CURRENCI ES Latest Previous Daily Change bid close change in 2019 Czech Hungary Polish Romanian Croatian Serbian Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1067.46 1065.390 +0.19% +8.20% 0 Budapest 40580.44 40819.08 -0.58% +3.68% Warsaw 2354.66 2365.93 -0.48% +3.43% Bucharest 7688.27 7775.17 -1.12% +4.13% Ljubljana Zagreb 1779.86 1782.77 -0.16% +1.78% Belgrade Sofia 592.28 591.07 +0.20% -0.37% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year 5-year 10-year Poland 2-year 5-year 10-year FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep 2.26 2.32 2.35 2.02 (PRIBOR= ) Hungary 0.38 0.62 0.79 0.15 Poland 1.74 1.74 1.74 1.72 Note: FRA are for ask prices quotes ************************************************* ************* ($1 = 277.5200 forints) (Additional reporting by Luiza Ilie in Bucharest; Editing by Toby Chopra)
