On Monday, August 15^th Dow Jones Index was able to maintain stable positive performance and rose 1.9%. As it has already been mentioned in the yesterday issue of UAIndex, the main causes for such increase were better performance of Japan’s economy and positive feedback of U.S. retail trade. S&P 500 rose 2.2% as well as NASDAQ rose by 1.9%. Despite those positive trends analysts are warning that such relative stability does not mean that the stock markets have fully recovered.

The main causes of sharp decrease in the markets were the worsened ratings of U.S. and worsened expectations towards debt crisis in Europe. These two issues remain, especially in case situation in Europe remains, it makes sense to even expect second wave of decrease. Relative period of stability is already known to the financial markets. In 2008, stocks have decreased significantly in September-mid-November period. Starting November till January 2009, the performance was relatively stable, yet in January 2009, sharp decline of almost 19% followed. Dow Jones remains 9% since its July level, when the decline started.

The tendency towards volatility remains this week. On Tuesday, August 16^th Germany and France leaders are meeting to discuss debt issues. Spain as well as several others have borrowed above the usual and may need help to repay their debts. Corporate deals concerning mergers and acquisitions were the central topics. In the agricultural sector, namely, Cargill has announced its intention to purchase animal nutrition company Provimi of the Netherlands for 2.16Bn USD.

As for Ukrainian Agrarian sector, it is tough to judge, especially on Monday, August 15^th, when Warsaw Stock Exchange was closed. The changes within the prices of the companies’ shares on this exchange were determined today by PLN to EURO fluctuations only. Investors remain cautious, yet the central tendency is still highly correlated with the performance of the global indices.

UAIndex