Russian election could dampen rise on market
The all-share WIG index closed at 12,646 points at the end of trading Friday, June 7, up 6.3% on the week. Accumulated volume amounted to zl. 369 million ($139 million) for the four-day trading week due to the Corpus Christi break, a 16% jump from the same trading days of the previous week.
The short-term outlook for the market is rather good if growth is stable, said Mateusz Andrzejewski, analyst at Bank Pekao brokerage house. But sharp rises in the WIG index could initiate a selling spree, he added.
The current uptrend on the market has been fueled by a lowering of prices during May, Andrzejewski said. Last month, the market declined nearly 5%.
Domestic selling was behind the May decline in prices, said Dariusz Piszczatowski, manager of foreign and institutional client services at Polski Bank Rozwoju brokerage house. Piszczatowski ruled out any major falls in the market. Foreign investors had come into the Polish market at the beginning of the year with large positions and for long-term investments, he said.
But the market is currently consolidating within a wide band between 11,000 and 13,000 WIG index points and could move 20% up or down, Piszczatowski said. While the market should move slightly upwards in the short term, Russian elections have added a note of uncertainty, he said. If Boris Yeltsin wins the presidency, we could see capital flowing into the whole region, he said.
Good news came to the market last week when ING Group upped its stake in Bank Ćlski (BSK) to 33% from 26%. ING paid zl. 210 ($79) per share compared with the BSK's then market price of zl. 196.5 ($174), which shows the bank's fundamental strength, Piszczatowski said. BSK's share price rose 21% on the week to zl. 238 ($90) at the close of trading Friday, June 7. The purchase will have a positive impact on the exchange underlining the attractiveness of Poland's listed companies, he said. Other banks on the exchange should also benefit from ING's purchase especially those already popular with foreign investors like Bank Przemyslowo-Handlowy (BPH) and Wielkopolski Bank Kredytowy (WBK), he said. BPH's share price rose 7% on the week to zl. 160 ($60) and WBK rose 15% to zl. 13 ($5).
Brau und Brunnen International, a German company which holds a 13.6% stake in brewery Okocim, may sell its stake in the Polish brewery, Piszczatowski said, after a provincial court in Tarn-w rejected Brau und Brunnen's attempt to have Okocim's recent 12 million new share issue annulled. Conflict between the two companies started earlier this year when Brau und Brunnen claimed that Okocim had misled it over the offering as no provision had been given in the issue's prospectus that Brau could maintain its previous 25% stake in Okocim. Brau said it had waived its pre-emptive rights to speed up the issue on the understanding that Okocim would not dilute its holding. Danish brewer Carlsberg took most of the shares, gaining a 32% stake in Okocim. Piszczatowski said Brau could possibly sell the shares to an investment fund or other investors.
The short-term outlook for the market is rather good if growth is stable, said Mateusz Andrzejewski, analyst at Bank Pekao brokerage house. But sharp rises in the WIG index could initiate a selling spree, he added.
The current uptrend on the market has been fueled by a lowering of prices during May, Andrzejewski said. Last month, the market declined nearly 5%.
Domestic selling was behind the May decline in prices, said Dariusz Piszczatowski, manager of foreign and institutional client services at Polski Bank Rozwoju brokerage house. Piszczatowski ruled out any major falls in the market. Foreign investors had come into the Polish market at the beginning of the year with large positions and for long-term investments, he said.
But the market is currently consolidating within a wide band between 11,000 and 13,000 WIG index points and could move 20% up or down, Piszczatowski said. While the market should move slightly upwards in the short term, Russian elections have added a note of uncertainty, he said. If Boris Yeltsin wins the presidency, we could see capital flowing into the whole region, he said.
Good news came to the market last week when ING Group upped its stake in Bank Ćlski (BSK) to 33% from 26%. ING paid zl. 210 ($79) per share compared with the BSK's then market price of zl. 196.5 ($174), which shows the bank's fundamental strength, Piszczatowski said. BSK's share price rose 21% on the week to zl. 238 ($90) at the close of trading Friday, June 7. The purchase will have a positive impact on the exchange underlining the attractiveness of Poland's listed companies, he said. Other banks on the exchange should also benefit from ING's purchase especially those already popular with foreign investors like Bank Przemyslowo-Handlowy (BPH) and Wielkopolski Bank Kredytowy (WBK), he said. BPH's share price rose 7% on the week to zl. 160 ($60) and WBK rose 15% to zl. 13 ($5).
Brau und Brunnen International, a German company which holds a 13.6% stake in brewery Okocim, may sell its stake in the Polish brewery, Piszczatowski said, after a provincial court in Tarn-w rejected Brau und Brunnen's attempt to have Okocim's recent 12 million new share issue annulled. Conflict between the two companies started earlier this year when Brau und Brunnen claimed that Okocim had misled it over the offering as no provision had been given in the issue's prospectus that Brau could maintain its previous 25% stake in Okocim. Brau said it had waived its pre-emptive rights to speed up the issue on the understanding that Okocim would not dilute its holding. Danish brewer Carlsberg took most of the shares, gaining a 32% stake in Okocim. Piszczatowski said Brau could possibly sell the shares to an investment fund or other investors.
