It has already come to the ruin of the stock market, because it is very hard to call this situation a crisis. The volume of bids and the daily index of the OTC Stock Trading System last week grieved even the most pessimistic analysts. The volume of operations fell 2.65 times and came to only Hr 934,000. The index fell 23.58% to 16.84 points (it started at 100 when it was introduced).
They say that the stock market mirrors the country’s economy. But I would go even further – today it lets us know how deep a well the economy is falling into. Reduction of the index shows that the investment climate in our country is extremely dangerous and that we should not count on the voluntary cash infusions from investors. They could give us a little help to keep the crisis virus where it is and not to let it out in Europe. However, unfortunately this is only the matter of time.
According to OTC Press Secretary Oleh Arestarkhov, the present situation determined the strategy of market operator behavior. Operators began to look to big foreign investors. With this purpose they have launched the consolidation (usually through exchange) of big stock packages (controlling or at least blocking), which they intend to offer to non-residents. There are three main branches of the economy – cement, sugar, and beer – which attract interest. And there are offers from brokers on stock barter operations to raise packages.
Last week confirmed the change of priorities of traders towards manufacturing emitters – brewery, metallurgy, etc. Bid volume and positive changes in selling prices support this fact. The secondary market of domestic bonds began reviving to the extreme happiness of operators – demand and corresponding reduction of the profitability down to 120%-150% (previously 220%-250%) a year with one month maturity. Operations with domestic bonds constituted almost 27% of total turnover.
Whatever happens, we tend to believe in a better future, and the selling price increase of some emitters gives us at least some hope.