Getting closer to autumn electionsmeans , moreideas and promises offered by polititians. They often concern important sectors of the economy, and indeed capital market itself. As a result, politicians often set trends on the WSE. Last week was an example of this. It had already begun a week earlier, with an information from the government regarding possible reduction of the tax on extraction of certain minerals.

Despite modest economic calendar, which theoretically translates to lack of incentives to serious movements in the stock markets, last week was not as boring as it was expected. On most stock markets, including the Warsaw Stock Exchange, supply prevailed over demand, which resulted in major indices drop over the week. In Polanddeclines were not, as usual ,the consequence of collapsing under its own weight, because they were accompanied by higher than usual turnover (probably supported by foreign capital).

For the first three days of last week we had quite a boring trade on the Warsaw Stock Exchange. Despite the weekend agreement between EU and Greece investors were waiting for Greek parliament’s approval for the reforms. When the reforms were approved, on Thursday, trading revived slightly and most of shares went up. 

If you look at the charts of most major indices of European stock exchanges, including the Warsaw Stock Exchange, you will see that in the last week they all looked almost the same. The charts resemble a bit the shape of a parabola. It is all due to European investors’ mood changes.

It was another week full of uncertainty awaiting for a solution to the Greek case. The market was being flooded with positive and negative information on progress in the negotiations between the Greek government and the Troika. On Monday all stock exchanges opened sharply lower after the breakdown of the weekend talks. As a result major indices in Europe, in the US and in Poland ended previous week in the red. Germany’s DAX lost 3.8%, so a little more than it had gained a week earlier.