Bourse bouncing back?

After a long period of record-high prices and skyrocketing indices on the Warsaw Stock Exchange (WSE), the time has come for corrections. Over the last two weeks, the large-cap WIG20 index lost some 17 percent. On Monday, May 22, the Warsaw bourse suffered its biggest daily fall ever and on Wednesday the share prices of the biggest listed companies were still dropping by six to eight percent.

Starting from Thursday, however, the situation started to stabilize. Good news for stock markets came from the US about a likely slowdown in interest-rate hikes. Another boost came from rallying copper producer KGHM - which benefitted from a rise in metal prices on the world's commodity markets - and oil companies. Also, share prices of Telekomunikacja Polska, Bank Pekao SA and BPH rose 3.8 percent, four percent and 3.2 percent respectively. Only Bioton - a favorite of investors - didn't manage to halt the downward trend.

On Friday, further increases were expected in large-caps. PKN Orlen was on everyone's lips as, after months of uncertainty, a ruling by a New York court allowed Russian oil company Yukos to sell Orlen its Możejki Nafta shares. The purchase of the 53.7-percent stake will be PKN Orlen's biggest international investment ever, worth some $1.5 (zł.4.6) billion.

Investors' optimism was boosted by positive reports on Lotos and KGHM released by BZ WBK, as well as CAIB Securities' improved assessments for GTC, Bank Millennium and construction companies.

Because of unstable prices of natural resources, which have a great influence on the decisions made by investment funds, brokers say it is difficult to give a credible prediction for trends in the nearest future. (Reuters)