The main index on the Oslo Stock Exchange ended Wednesday with a slight decrease of 0.16 percent.
Yesterday ended a new high for the stock exchange, despite the war in Europe, global turmoil and inflationary pressures.
It may seem counterintuitive that stock markets go up with so many uncertainties, but there may be many motives; First, inflation and rising interest rates contribute to very weak bond development.
Here’s what chief strategist Christian Lee in Formy says. Lee notes that corporate bonds globally experienced their weakest six-month period since the financial crisis with prices down more than ten percent, measured in dollars.
“Inflation, on the other hand, can provide a boost to corporate earnings growth, which is measured in nominal terms, and as long as the economy remains reasonably strong, stocks can provide relatively better protection against inflation than bonds,” he says.
Lee points out that the economic consequences of the war in Ukraine have so far been priced in.
– How long can this stock market continue to rise?
– Perhaps the height is too fragile. Negative developments in Ukraine’s geopolitical conflict, signs of weakness in the overall picture or earnings estimates, and/or even more “hawkish” signals from the Federal Reserve and the European Central Bank could weaken risk appetite again, he says.
Uncertainty in punishment
The market is also focused on the Norges Bank rate decision due on Thursday. The central bank governor is very likely to raise the interest rate by 0.25 percent.
North Sea oil was trading at around $116 a barrel before the Oslo Stock Exchange opened on Wednesday – an increase of 1.21 percent since its last closing price. In recent days, players in the oil market have sent signals regarding oil sanctions against Russia.
So far, there appears to be opposition, especially among German politicians, to a complete moratorium on imports. Lee says plans to become less dependent on Russian energy are long-term and it will not be possible to fully replace Russian energy from other sources in the short term.
The Rise of the Aker
On Wednesday morning, Kjell Inge Røkke’s Aker Horizons announced that the company Sells from Rec Silicon before 1.4 billion NOK South Korean Hanwha Solar Corporation. This is the second sale to South Koreans in six months, and now the green spearhead of Kgil Inji Rocky from Rec Silicon is out for good.
- Aker Horizons stock ended up 11%.
- Rec Silicon shares closed 2.5 percent higher.
Cod farmer Norcod announced Tuesday night that the company has raised NOK 175 million in new money in a private placement. The IPO price was set at NOK 80 per share, which corresponds to a 10 per cent discount from Tuesday’s closing price.
- Norcode shares fell 2.13 percent on Wednesday.
Bergen-based shipping company Odfjell SE has decided to pay a dividend of NOK 1.00 per share for 2021, according to a stock exchange announcement on Tuesday. This is the company’s first dividend payment since 2018, according to an overview from Bloomberg.
- And Odfjell Drilling shares rose 4.5 percent.
The most heavily traded stocks on the stock exchange were Equinor, which rose 1.87 percent, Aker BP, which rose 2.62 percent, and Norsk Hydro, which rose 1.97 percent.
Asia and the United States recovery
The Nikkei index on the Tokyo Stock Exchange started Wednesday with an increase of more than 2.7 percent on Wednesday morning. The main index is up nearly 15 percent in two weeks and is back at the same level it was two months ago – around 28,000.
This is the seventh consecutive trading day that the Nikkei has risen. Technology and investment company Softbank is leading the rise by nearly nine percent. In one week, Softbank’s exchange rate rose by 28 percent.
All three major Wall Street indexes ended higher on Tuesday:(Terms)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using a link that leads directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.
- The broad S&P 500 index rose 1.13 percent.
- The Dow Jones Industrial Average rose 0.74 percent.
- The Nasdaq Technology Index rose 1.95 percent.
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