After the Christmas madness, a breather

The end of the year and the first days of January were marked by a relatively good mood on the stock exchange, as the indexes sluggishly hauled themselves back up. Even though the jitteriness of investors had calmed, it was hard to expect a bigger injection of optimism. However, the situation on the interbank market clearly revealed a growth in mutual distrust, in spite of help from the European Central Bank, lending EUR 450 bln to the banks, who immediately deposited the money in the central bank. Nonetheless, the structural problems of the eurozone - the catalyst of all the recent stock exchange decreases - remain unsolved. The January effect (the first month is statistically one of the best periods on the stock exchanges) definitely gave the trading floors a lift. By the middle of January, the stock exchanges had grown moderately, though it was difficult to identify the factors behind this development. The troubled eurozone, worries about UK debt and the recurring problems with the American budget, are all factors that could combine to make 2012 no better than 2011. There was less optimism on the Warsaw Stock Exchange than abroad, even though the data from the real economy indicates that the economic slowdown will be more limited than was forecast just a few months ago. The weak złoty is helping exporters, while its big internal market makes Poland resistant to a number of European recession scenarios. Its fiscal situation also sets Poland apart from the rest of Europe in a positive way - the public sector deficit will slightly exceed 3 pct of GDP this year, close to the value required by the European Union. However, there is no optimism to be seen on the stock exchange, where the WIG index growth of 1.2 pct and WIG 20 of 1.5 pct within a month being nothing out of the ordinary. Uncertain times are characterised by a divergence of forecasts - ranging from those predicting that the WIG will drop below 1,000 points to those saying that it will increase to the level of 3,000 points.
Taking into account these circumstances, the behaviour of the two sector indexes is even more surprising. WIG-Construction grew by as much as 10.7 pct in just two weeks, reaching its level of the middle of November. Meanwhile, WIG-Developers increased by over 2 pct - also achieving better results than the broader market indexes. This clear bounce of WIG-Construction results from the rising stock of companies that make up the lion's share of this index. Particularly PBG, which after a few months on the slide is now rebuilding its former position. Moreover, Mostostal Warszawa enjoyed big growths, as well as Budimex and Polimex Mostostal. Among the smaller companies it is worth mentioning the successful bounce of Trakcja-Tiltra after the reduction of its share price in November and December. An announcement was made at the beginning of January about Czech power group CEZ's purchase of shares in Eco-Wind Construction from Trakcja. The acquired capital will allow the company to repay the liabilities of its subsidiary Poldim. A few days later the banks suspended enforcement actions against Poldim. The beginning of the year also turned out to be a good time for ABM Solid. Dom Maklerski IDMSA is considering purchasing shares in ABM. However, the company has to draw up a restructuring plan. The term of the agreement between the banks and bondholders of the company has now been extended until February 29th, by which date they will not make any claims or put forward any motions to force it into bankruptcy. The Christmas and New Year period was not so successful for development companies. The downtrend was largely to do with GTC, which only started making up for its losses after January 10th.
Meanwhile, in the middle of the year we can expect the debut on the stock exchange of the PHN group, which has been established as a result of a merger of treasury-owned companies from the property sector (including Intraco, Budexpo and Polski Holding Nieruchomości). The portfolio of the group includes 1,300 ha of land. Its prospectus is to be submitted to the Financial Supervision Authority in Q2, while the debut is to take place at the end of June. ? (Mir)

Declines in Hungary and turbulence in Prague
The Budapest stock exchange fell over the period. The BUX slipped by just under 1 pct compared to the middle of December. The losses could have been bigger due to the growing tensions over government plans to restrict the central bank's independence, with investors set to take flight from Hungarian (and Central European) assets. The growth of the index after January 10th was the result of reports concerning the possible resumption of talks over aid for Hungary. Meanwhile, in Prague the broad market index grew by over 5 pct. As the financial sector remains jittery all over Europe, the Prague stock change also experienced strong fluctuations.