On the Warsaw Stock Exchange, bulls dominate again. The problem is that investors remain heavily dependent on what happens in the Middle East.
WSE in green
A lot of hits from bears were taken by the company IMS (-6.39%). The leader of gains turned out to be the biggest loser from the previous session, namely Mostostal Warsaw (~+30.75%). It is also worth noting the problems of Orlen, which lost 2.26% in value throughout the session. The reason was an improvement in the geopolitical situation.
The WIG index finished the session at 133,387.44 points, which translates into a price jump of 2.56%.
Chart. WIG index price
Source: TradingView
WIG20 index at 17:00 was at level 3,629.57 points, indicating a rise of 2.83%.
Chart. WIG20 index price
Source: TradingView
mWIG40 ended the Wednesday session at 9,261.74 points, indicating a jump of 1.75%.
Chart. mWIG40 index price
Source: TradingView
Meanwhile sWIG80 rose to 31,200.46 points. That means the index gained and it was quite strong - up to 1.57%.
Chart. sWIG80 index price
Source: TradingView
See also: MDI Energia shares still give profits to bears, Trans Polonia is unbeatable in the bull market. WIG20 fears events in the Middle East
Rise sponsored by hope for peace
Adam Stańczak, analyst and commentator DM BOŚ, reported the Wednesday session and noted that “WIG20 finished the first hour of the session with a move towards the 3600 points area.”
“The index rises by about 2% buoyed by a rise in the DAX of about 1.5%. In fact, demand is also helped by metal gains – which results in a rise of KGHM by over 5% – and the strengthening of the zloty against the dollar by 0.5%. From a technical perspective, a return to the psychological barrier of 3600 points can enjoy the speed of recovering losses, but it really only moves the index barely to the middle of the shelf 3705-3466 points, whose symbolic and technical boundaries are levels 3700 points and 3500 points”, summarised the first hour of the session.
Meanwhile Marek Rogalski, chief analyst at DM BOŚ, in his new market report wrote that “just two days ago it seemed that we were heading towards a serious escalation in the Middle East, but Donald Trump announced at night that the USA will withdraw for some time from the Freedom Project operation, which was supposed to somewhat unlock transit through the Strait of Hormuz.”
He himself interprets it as “Americans did not want to risk further serious provocations with Iran that would force them to announce the cessation of the truce that has been in place since April 8.”
“At the last press conference the US president made a ‘good face’ to the quite tense situation, while the US administration’s interest is now withdrawal from a conflict that could plunge Republicans into the November midterm elections. So, will there be a return to serious attacks on Iran? At least not now,” he added.
Rogalski notes that “markets are pleased with such a turn of events, although despite another TACO, the strategic situation does not change much – the Strait of Hormuz remains closed, and the USA maintains its blockade against movement to Iranian ports.”
“The war remains ‘frozen’, and hopes for a peace agreement are small – despite what Donald Trump tries to claim. It is not impossible that the Iranian issue will be a subject of talks with the Chinese, but in their interest paradoxically it is not a quick peace – Xi [Jinping] knows well that this conflict steadily weakens the international position of the USA,” he summarised.
Read also: MDI Energia shares give up profits, ERG surprises with gains. WIG20 looks at the USA and the Middle East
See also: Mostostal shares still lose value. The big winner is Azoty Group shares. WIG 20 regains strength
Source: Bossa.pl
