Stocks report: No panic on the WSE

After Tokyo's Nikkei lost 2.95 percent and the session was shorted by an hour, the WIG20 initially fell 2.5 percent but quickly recovered from levels below 2,800 points and as global markets jumped late last week, Polish stocks were attacking historical highs.

The season for announcing Q4 2005 results  is upon us. Last week, the first large bank to report, Bank Millennium, announced relatively good results and in the strong bull market the bank's shares were rising. The market expects very good results from banks and KGHM. If they disappoint, it will surely serve as an excuse by market participants to sell their shares.

The coming week will provide an answer to the question about interest rates. The Monetary Policy Council (RPP) meets on Tuesday, and the market is very uncertain about its decision. On one hand, inflation is the lowest and the highest real interest rates in the whole European Community. On the other hand, the representatives of the RPP recently expressed their doubts about the sense of cutting interest rates in a period of political instability. Thus, expectations vary from no change in interest rates to a 50 basis-point cut to four percent.

Adam Łaganowski,

WGI Dom Maklerski