#WarsawStockExchange

[beststockshare]

Here are the Best Stocks of the WIG30 Index, Warsaw Stock Exchange, Poland Stock Market for January 2022

[dswdsw00]

WarsawStockExchange

[maxpolished-blog]

Mayans vs. Warsaw Stock Exchange. 2012 recap.

When you try to predict as to what’s going to happen on any stock exchange whatsoever,  you obviously look at the current macroeconomic situation, market sentiment, future expectations and so on. In addition to January usually being the odd one out month, there’ve recently been series of events that had the means to shape the market in the forthcoming months. Namely, the US fiscal cliff, ECB’s Draghi stance on interests rates (in the light of the so-called “currency war”), European Union agreeing on a budget, and last but not least – the end of the world. As the mentioned issues seem to be resolved resulting in a very awkward feeling of stabilization in the air, and to everybody’s astonishment – the Mayans apparently getting it wrong and thus allowing us to live a tad longer, one might as well carry on with the usual business of analyzing the current market situation to produce a highly probable forecast for the year at hand. Before just doing that it’s crucial however to take a look at 2012, because it may hold some additional clues as to what exactly is going on on the market and where it may be heading. I gathered some data on the WSE and put it all together so you could get a better picture of the Polish stock exchange. You can check my findings later down below.

First off, lets summarize what we’ve learned:

- all indices rose by more than 20%, but around 40% of the gains where courtesy of a end-of-the-year December bonanza  - turnover on the WSE fell sharply (most importantly stock and derivatives 24 & 40% respectively) - P/E (price to earnings) and P/BV (price to book value) ratios have been on the decline while the dividend yield has been rising  - although still lagging behind in IPO value to the biggest European stock markets, Polish IPO market wasn’t that bad in regards to both volume and value - 70% of the whole year IPOs value was attributed to one offering worth €511mn (biggest deal in 2011 was worth €1.44bn) - bonus chart: cost of borrowing fell in the whole European Union, in the Euro Area and – in particular – in Poland, with spreads between the three decreasing towards the end of the year.

So the Mayans were not entirely wrong after all. Something was brewing in December, they just didn’t hit the jackpot (or terribly underestimated Poland’s ability to resist ill fortune). The gain on the index itself is alright (esp. if you compare it to 2011) but the fact it was done with much lower turnover and big chunk of it in December, doesn’t exactly scream enthusiasm. The market is hesitant and investors themselves aren’t entirely sure what the future holds.  Although the lower level of P/E ratio might suggest that stock are undervalued and it is a good time to buy and in the consequence the market is poised to rise, as it turns out – the situation isn’t necessarily that colorful. An omnipresent issue is that companies have been recording lower margins on profits, courtesy of the global slowdown undoubtedly. Couple that with the fact that companies and analysts have been forced to lower, for some time now, future predictions of EPS (earnings per share), we arrive at lower P/E and forward P/E ratios. It’s also no secret that during times of uneasiness, investors tend to flock to shares paying out dividends, hence the higher dividend yield observed. Again, it doesn’t say anything definitive one way or the other, just strengthens the feeling of uncertainty on the stock exchange.  The state of the IPO market is more straightforward to explain. There’s a great risk, which many companies are unwilling to take, of going public when the market is so volatile. Costs of preparing and conducting an IPO (esp. on the main market) are still quite high, and a failure could deal a significant blow to a company’s finances. In addition to all the data regarding WSE, I put a chart of how exactly government bond yields had been changing in 2012, because there’s always correlation between the two. As you saw the costs of borrowing went down across the whole EU, noting biggest declines and reduction of spreads towards the end of the year, in December in particular (those Mayans again). That would indicate a renewed belief the worst part of the European recession is left behind and better times are at hand. In fact, the demand for Polish government bonds was so high, that Poland managed to satiate 40% of its borrowing needs for 2013 in January already. Given the knowledge of the inflation being held in check and expectations for interest rates to be cut (to stimulate growth), those could partly explain the higher demand. One other complementing explanation is that, while investors generally expect the macroeconomic situation and condition of companies to improve, they just aren’t willing to die for that belief (hence the lower turnover on the riskier stock exchange).   

Bartosz Grejner GLPartners.pl

[beststockshare]

Here are the Best Stocks of the WIG20 Index, Warsaw Stock Exchange, Poland Stock Market for January 2022

[lawyerspoland]

A foreign company in Poland can have significant advantages if they choose to list on the Warsaw Stock Exchange. This is the list of benefits: