Summary

The economic calendar was very rich last week. Investors paid special attention to the data from the American economy. This was very important due to the investors’ expectations concerning the interest rate raise by Fed. This time readings did not fail. The publications of the Conference Board index (104.1 pts.), the Richmond Fed index (-8 pts.) and the Chicago PMI (54.2 pts.) turned out to be higher than projections. In addition, the final reading of the annualized GDP growth for the second quarter stood at 1.4% vs 1.3% expected. Meanwhile, there were releases of the confidence indices for the Eurozone. They surprised investors positively. It is worth paying attention to the unemployment rate in the Euroland as well. The result of 10.1% was higher by 0.1 percentage point than the market consensus. Nevertheless, the market sentiment did not support the most important global stock indices. It could have been the result of the Deutsche Bank’s problems. The share price of the bank reached its historical low peak. The market was concerned about the situation of Deutsche Bank because it may adversely affect the global banking and financial sectors. During the whole week, German DAX fell by 1.1%, French CAC40 declined by 0.9% and British FTSE250 went down by 0.3%. Unlike to them, the US indices reported slight increases. The DJI rose by 0.3%, the S&P500 grow by 0.2% and the NASDAQ soared by 0.1%. Moreover, attention should be paid to the agreement on the reduction of the oil production signed by members of the OPEC. It was the first compromise for eight years. Nonetheless, the new limit was a little bit lower than the current production level.

The last week of September was not successful for the investors at Ksiazeca. The WIG20 decreased by 3% and the mWIG40 fell by 1.3%. This time the Polish economic calendar was not rich. Nevertheless, the political stage aroused a lot of emotions once again. On the one hand, the announced cabinet reshuffle did not bring many changes, whereas on the other the significant reinforcement of the Mateusz Morawiecki’s position in the government certainly caught the investors’ attention. Furthermore, Moody’s presented its projections concerning the Polish economic growth. The agency estimated that the GDP growth rate would stand at 3.1% in 2016 and 3% in 2017.

In the first week of October it is worth paying attention to the publications of the manufacturing PMI’s from the Eurozone and Poland. Moreover, the Polish event of the week will be the MPC meeting. The market consensus assumes that the cost of money will remain unchanged. In addition, investors will learn a lot of economic data from the US e.g. the ISM indices and the payrolls.

Technical analysis

Graph 1: WIG20 daily. Source: Stooq

In the last week of September the blue – chip index was dominated by the red color. As a result, the WIG20 ended last week at 1,709 pts.. After the significant increases at the beginning of the year share prices of the largest Polish companies started to decline. On the other hand, the WIG20 has moved in a narrow range since May. It cannot be ruled out that the market was ready to rebound. However, it seemed that investors waited for some fundamental incentives. The RSI oscillator remained neutral and moved towards south dynamically. The closest support level stands at the psychological barrier of 1,700 pts.. It is possible that the market will be able to defend this level.

Graph 2: Sygnity daily. Source: Stooq

This time we chose Sygnity as a company of the week - its share price increased by 11.1%. The course has been in the long – term downward trend. However, there were plenty of indications that share price reached its low peak at PLN 4.25 mark. The RSI oscillator grew rapidly, whereas remained neutral. Attention should be paid to the increased volume of trade as well. The Friday’s close price stood at PLN 4.90. It was very important resistance level. Perhaps, its breakthrough will be a signal for further growths towards the level of PLN 6.

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

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