European stock exchanges were in retreat in the past week. The scale of declines were similar to previous week gains. Positive technical situation was negated on DAX (declined by 2.2%) hence the risk of descent to 11,000 is quite substantial. The Paris CAC40 also declined, but in a slightly smaller scale (by 1.9%). Most of a week government bonds were in retreat. German Bunds recovered some losses towards the end of the week.

Weekly comment MM Prime TFI  - May 11, 2015

Since the beginning of the year, we have noticed clearly improved sentiment on the WSE. While the beginning of the year was dominated by small and medium-sized companies, since the launch of the European version of quantitative easing, large companies were in domination. The WIG20 gained 5% in April, while mWIG40 went up by 3.5% and sWIG80 by only 2.3%.

Last week indices at Książęca did not change much. Biggest price delta of 0.2% was noted on a declining WIG20 index. Considering significant increases of the index during recent weeks, such correction brought only a little pain to WIG20 long investors. This correction may easily transform into a deeper decline, which does not have to strike out a slowly emerging bull market on the WSE.

Once again we are witnessing an interesting disproportion of forces - the Warsaw Stock Exchange is much stronger than their western competitors. Great leaders are the members of WIG20 index, which grew by 2.2%, closing the week at 2519 points. With such dynamic, an increases to 2560 points (September peak) can be within current index strength. Indices of medium and small companies were weaker - mWIG40 grew by 1.1% and sWIG80 by 1.7%.