Ukrainian stocks ended lower last week amid a rise in political tension in the country in the form of street demonstrations by aggressive anti-government radicals. Both the IMF and the World Bank expressed concerns about recent presidential attacks on Ukraine’s two main independent anti-corruption institutions: the National Anti-Corruption Bureau (NABU) and the Special Anti-Corruption Prosecutor’s Office (SAP), as this threatens their ability to fight corruption and recover stolen assets. Another disappointing piece of news for the country’s reform agenda was the extension of the ban on sales of agricultural land until the end of 2018. The launch of an agricultural land market is a key IMF criteria for resuming loan disbursements. The decision looks like a timid cave-in to populists and corporate interests as President Poroshenko looks to find the path of least resistance heading into the presidential election scheduled for April 2019.
The UX index ended 0.4% lower at 1277 points. UkrNafta (UNAF) lost 1.3% to close at UAH 142 per share, ignoring positive news for the industry that the gas production tax will be lowered from 29% to 12% for new wells. Low-liquidity DonbasEnergo (DOEN) fell 1.1% to UAH 18.60. Meanwhile, Raiffeisen Bank Aval (BAVL) gained 1.4% back to 28.40 kopecks after a moderate correction seen earlier this month.
In London trading, Ferrexpo (FXPO) corrected further losing 0.2% to GBp 253, possibly on political concerns, despite encouraging news about a new dividend distribution of 3.3 US cents per share. Illiquid MHP (MHPC) remained in its usual trading range, edging up by 0.9% to USD 11.45.
On the Warsaw Stock Exchange, Kernel (KER) got back above the PLN 50 level on reports that the company’s majority shareholder Andrey Veryovskiy continues to buy up shares on the market. The stock advanced by 5.6% to PLN 50.60.
The hryvnia was nearly unchanged over the week, trading at 27.10 UAH/USD.
POLITICS AND ECONOMICS
- Saakashvili Arrested on Charge of Collusion with Yanukovich
- Ukraine’s Steel Output Set to Finish 2017 With 13% YoY Drop
STOCKS IN THE NEWS
- Ferrexpo to Pay 3.3-Cent Special Dividend by Jan 15
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