Summary

Holy Week was extremely interesting. However, this time political events were in the spotlight, while the latest macroeconomic data releases remained in the background. The increase in tension between the US and North Korea stepped up fears of a possible armed conflict outbreak. Furthermore, the latest French polls showed that the race to the presidential chair would be really fierce and the support for eurosceptics was really significant. As a result, investors started looking for safe havens, so it was not a surprise that the price of gold went up appreciable. Moreover, the market sentiment was bearish last week – most of major global stock market indices moved towards south. During the whole week, French CAC40 declined by 1.3%, German DAX went down by 1%, whereas British FTSE250 grew by 1.5%. In the US, the NASDAQ fell by 1.2%, the S&P500 deteriorated by 1.1% and the DJI dropped by 1%. The latest Donald Trump’s statements aroused a lot of market emotions as well. The President of the US changed his views on many issues. He said that dollar was too strong. What is more, Donald Trump emphasized that he was a proponent of low interest rates, while during the election campaign his attitude had been hawkish. There was also a public appearance of Janet Yellen last week. Nonetheless, this did not bring anything new – the FOMC will probably raise interest rates two more times in 2017.

Last week, the Polish stock market indices were dominated by bears as well. During the whole week, the WIG20 declined by 0.7%, the mWIG40 went down by 2% and the sWIG80 fell by 1.3%. Curiously, despite Easter, the volume of trade remained at a solid level. However, this was quite bad news for the investors who were waiting for a continuation of an upward trend, as it seemed that the market sentiment on the WSE remained bearish. The Polish economic calendar was not very rich last week. Investors learnt the CPI which stood at 2% y/y. The result was in line with the market consensus. It is worth reiterating that Griffin Premium launched its IPO last week – it has been the first REIT listed on the Polish stock market.

This week, special attention should be paid to the further situation around North Korea. In addition, investors will learn a lot of important macroeconomic data, among others, the PMIs for the Euroland and the US. Moreover, the Fed will present Beige Book. In Poland, there will be publications of data on the manufacturing production and the retail sales. Investors will also learn the minutes from the last meeting of the MPC. It should be noted that the first round of the presidential elections in France will take place next Sunday.

Technical analysis

Graph 1: WIG20 daily. Source: Stooq

Last week, the index of the largest Polish companies continued a correction which has taken the form of a consolidation. During the past week, bears turned out to be a dominant party, so the WIG20 ended Thursday’s trading session at 2,233 pts.. The volume of trade was relatively high and the RSI oscillator remained neutral. A breakthrough of the resistance level at 2,300 pts. should be considered as a buy signal. On the other hand, if the market manages to overcome a support level at 2,170 pts., this will be a sell signal.

Graph 2: Atende daily. Source: Stooq

This time it is worth paying attention to the share price of Atende. During the whole week, it rose by 5.3%. The stock price of the IT integrator has been moving in an upward trend since the second half of 2016. However, the market was unable to break the resistance level at PLN 4 for a long time. After the breakthrough, the share price started another upward wave, thereby reaching its historical peak (PLN 5.34). Nevertheless, the technical oscillators were overbought, so a potential correction cannot be ruled out. In the case of this scenario, the nearest support level stands at PLN 4.5. After all, it is possible that the growth potential has not been fully used up, especially since the fundaments of the company seem to be promising.

Authors: MM Prime TFI S.A. Investment Management Team

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