Leading Ukrainian shares rose more than 5 percent in the latest trading period, and experts predict further market growth, but relatively low volumes this week.
The PFTS benchmark index closed at 42.20 on Jan. 18, compared to 39.92 the week before.
Trading volumes, which include deals with treasury bills and promissory notes as well as shares, rose to Hr 9.211 million from Hr 4.9 million for the previous trading period. However, the previous trading period lasted only two days.
'The sensational statements by [Deputy Prime Minister] Yulia Tymoshenko [on the situation in the energy sector] didn't affect the stock market,' said Roman Osypov of Alfa Capital. 'Quotes for all the blue chips have risen.'
Traders put the low trading volumes down to the market's expectations of future growth – dealers are waiting for prices to rise before they sell.
'When the sky's the limit for blue chips, the volumes will grow,' added Osypov.
Share traders' bullish mood wasn't matched in the promissory note market, where Tymoshenko's comments about illiquid settlements were perceived as an attack on the practice of issuing promissory notes. Dealers said operations with promissory notes in the energy sector had suffered as a result, and trade was subdued.
'I understand that liquid monetary tools like ready money are much better than promissory notes, complicated schemes of settlements or barter,' noted Oleksandr Husev of Alfa Capital. 'But promissory notes used to bring at least something into the energy sector. And it's not clear where Tymoshenko is going to get the money from.'
The Wood-15 stock index closed at 1,133 on Jan. 18, having risen 8.38 percent from 1,038 the week before.
The PFTS in 1999
After spending most of the year in the doldrums, the PFTS market rallied late in 1999, managing to regain in a month most of the ground it lost in 1998.
The PFTS index of leading Ukrainian shares, which started the year at 22.72, rose to 39.07 at the end of the year – a rise of 72 percent which nearly wiped out the disastrous 73 percent fall of 1998, the year of the regional financial crisis.
Moreover, the PFTS's total trading volume in 1999 was Hr 988.44 million, 2.9 times more than in 1998. Some 3.99 billion shares changed hands through the exchange's electronic system in 1999.
The PFTS's late rally started a week before the first round of voting in the presidential election in October, when expectations of a victory for Leonid Kuchma began to filter through to the market. The increased market activity helped boost the exchange's trading statistics, pushing the average daily trading volume to Hr 4.03 million (3.1 times more than in 1998) and the average number of deals struck per day to 31.
December was the most active trading month, with a total trading volume of Hr 173 million and 2,271 deals recorded on the system in that month. The PFTS index hit a year high on Dec. 30, closing at 39.07. January 1999 was the quietest month in the year, with only Hr 11 million worth of deals being struck, and only 134 trades recorded – a record low.
As in 1998, share trading comprised the bulk of deals recorded on the system – 61.9 percent. But in 1999 dealers switched from trading ODVPs to promissory notes. Whereas in 1998, p-note trading comprised 1 percent of all deals struck on the system, this rose to 32.06 percent in 1999. The share in trading in ODVPs, on the other hand, fell from 35 percent in 1998 to 6.04 percent in 1999.
The top three share traders in 1999 were Alfa Capital, Wood & Co. and Prospect Investments. The leading promissory note traders were Grand Capital, Zevs and Tekt.
The most popular share issuer, both in terms of trading volume and number of deals was the Mykolayiv Alumina Plant with Hr 91.68 million in trading volume and 1,364 deals recorded last year. The second most popular shares were those of the Kyiv Carton and Paper Factory which saw Hr 62 million worth of its shares change hands. In third place was Stirol with Hr 55.59 million.
'The Ukrainian stock market has finally revived,' said PFTS Association President Iryna Zarya, summing up the year. 'Now you can even earn money on it.'
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