Keeping their WIG on

After a few nervous weeks in July and August, the end of the holidays brought investors on the WSE some relief – the markets rebounded

and September began with increases on all the indexes

The WIG20 gained the most, as foreign investors returned to emerging markets. Optimism wasn’t fully renewed however, as the uncertainty regarding the situation on the US domestic market and its influence on the entire US economy continued. In fact, the final weeks showed how investors on the WSE are powerless in the face of fluctuations on the world’s major markets.

During the first half of September, the indexes moved up slowly, but turnovers were low, as the financial markets waited for September 18th and the FED sitting. And indeed, the FED announcement did help stock exchanges worldwide. The deeper than anticipated rates cut (by a half point instead of 0.25 pct) gave a boost to the indexes. The WSE saw heavy trading as shares were acquired by foreign investors as well as by domestic investment funds. The blue-chip WIG20 index shot up vigorously, closing at 3.92 pct above the previous day’s finish.

But, after all the euphoria, the fundamentals of the US economy came to the fore, and much now depends on forthcoming US macro data.

 It is worth mentioning that New Connect has now been launched – a new market for small companies hoping to raise between several hundred thousand and a few million PLN, and featuring innovative products and services. Companies will be able to be listed on the WSE’s alternative market system outside the regulated markets. Real estate company Stark Development has already announced that it wants to enter New Connect, before moving back to the WSE after 2 years

Back with the construction sector on the WSE, one could see that GTC performed well despite the nervous atmosphere surrounding the WSE. Many ‘buy’ recommendations were issued by brokerage houses, but this is not the only reason – the company is expanding broadly into central and southern European markets. z    (mir)