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CEE MARKETS-Polish assets gain as CEE stocks, FX mostly ease

    PRAGUE, Jan 5 (Reuters) - Prague and Hungarian stock markets
retreated from multi-month highs on Tuesday and currencies
mostly drifted lower after renewed concern about the COVID-19
pandemic stalled a rally.
    Czech bond yields dipped from new highs as markets priced in
budget news before the finance ministry announces 2020 deficit
figures on Tuesday. The pandemic has hammered the region's
public finances.
    In Poland, assets bucked the weakening trend with a 0.7%
rise in the blue-chip index, led by a rebound for
clothing retailer LPP. The zloty gained
0.2%against the euro, bid at 4.54 at 1038 GMT.
    "Yesterday LPP and (shoe retailer) CCC were bottom of the
WIG 20," said DM BOS analyst Konrad Ryczko. "The theme of
lockdowns in Europe appeared again and it weighed on clothing
retailers but today they are bouncing back."
    Market participants are keen to move on from a volatile
2020, but new lockdowns, notably in Britain and Germany, brought
to a halt a rally fuelled by some promising economic indicators.

    The number of active COVID-19 cases in the Czech Republic
was at its highest since late October. The country's strictest
lockdown measures apply, although industry remains open. 
    The crown dipped to 26.196 per euro. Hungary's
forint was a touch down at 361.20. Stock indices in
Prague and Budapest touched their highest marks
since February and March, respectively, on Monday but shed 0.8%
and 0.2% on Tuesday.
    "It is about COVID again," a Prague forex dealer said. 
    The dealer said the crown's firmer trend faltered at around
26.100 per euro in the previous session and that level, which
ended rallies last month, would continue to provide resistance.
    On bond markets, yields mostly dropped, with the Czech
10-year benchmark at around 1.28% and just off its
highest level since May.
    Czech Finance Minister Alena Schillerova said on Dec. 30 the
2020 budget deficit would reach a record 370 billion to 380
billion crowns ($17.83 billion). Markets are bracing for another
year of high borrowing with public finances likely to end 2021
deep in the red.
    
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1138              
                                     CET               
                                                              
                   CURRENC                                    
                   IES                                 
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2021
 EURCZK  Czech     <EURCZK  26.1960  26.1860   -0.04%   +0.13%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  361.200  361.150   -0.01%   +0.42%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.5444   4.5546   +0.22%   +0.33%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8705   4.8700   -0.01%   -0.11%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5600   7.5615   +0.02%   -0.17%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.520  117.600   +0.07%   +0.04%
 =       dinar     =>             0        0           
         Note:     calcula                    1800            
         daily     ted                        CET      
         change    from STOCKS                                     
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2021
 .PX     Prague             1021.49  1029.27   -0.76%   -0.55%
                                          00           
 .BUX    Budapest           42237.4  42333.4   -0.23%   +0.31%
                                  4        8           
 .WIG20  Warsaw    <.WIG20  2023.29  2008.75   +0.72%   +1.98%
                   >                                   
 .BETI   Buchares           9840.66  9843.60   -0.03%   +0.36%
         t                                             
 .SBITO  Ljubljan  <.SBITO   911.64   905.86   +0.64%   +1.20%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1761.72  1743.99   +1.02%   +1.29%
                   >                                   
 .BELEX  Belgrade  <.BELEX   747.58   749.91   -0.31%   -0.14%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   448.87   446.94   +0.43%   +0.30%
                   > BONDS                                      
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   0.2510  -0.0420   +097bp    -5bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.8020  -0.0170   +156bp    -2bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.2810  -0.0270   +187bp    -4bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   0.0490  -0.0240   +076bp    -3bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   0.3980  -0.0400   +115bp    -5bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.2300   0.0060   +182bp    +0bps
 =RR     10-year   =RR>                             s  
                                                              
                   FRA                                        
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     0.41     0.49     0.60     0.36
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.68     0.69     0.71     0.75
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     0.18     0.16     0.15     0.21
                   ><WIBOR                             
                   =>                                  
         Note: FRA quotes                                     
         are for ask                                   
         prices                                        
         ***********************************                  
         ***************************                   
                                                              
 

    

 (Reporting by Jason Hovet in Prague, Anita Komuves in Budapest,
and Alan Charlish in Warsaw; editing by Barbara Lewis)
  
 
 
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