Eastern European stock markets are booming: more peppers in your portfolio!
At the well-attended Hamburg Stock Exchange Day on 11 November 2023 with many speakers and exhibitors, the war in Israel and the Fed’s future monetary policy were also the dominant topics. Nevertheless, most of the speakers believed in a year-end rally. Investment guru Heiko Thieme believes that the DAX will exceed 16,000 index points by the end of the year. Only a few investors have so far taken advantage of the great opportunities on the stock exchanges of Eastern Europe, which even bucked the downward trend on the world’s stock markets in September/October to reach new highs for the year. The HTX index of the Budapest Stock Exchange, for example, has already risen by 42 per cent (!) in euros to a new high for the year. At the invitation of Freedom Broker, Andreas Männicke gave a presentation at the Hamburg Stock Exchange Day on the new opportunities in Eastern Europe, especially in Kazakhstan and for some Russian ADRs on the OTC market.
Some Russian ADRs can now also be converted into original shares again if the investor has previously obtained an exemption authorisation from the Bundesbank and opened a rouble account in Russia. Risk-averse investors can now also buy promising Kazakhstani shares directly online via the broker Freedom Broker if they open an account beforehand, which is easy to do online at this link: https://freedom24.com/invite_from/2952896 . Although Russian ADRs or original shares are still not tradable due to the sanctions, new opportunities may soon arise with Russian ADRs, which you can now buy at discount prices via the brokers Zerich Securities Ltd or Freedom Finance from Cyprus. Gold and silver producer Polymetal, for example, has already risen by over 50 per cent after it was delisted from the London Stock Exchange and has now been made tradable on the AIX in Kazakhstan. Interesting stocks on the OTC market are above all the Russian discounter Fix Price, which has now also gone public on the Kazakhstan stock exchange, and the IT stock VKontakte (more on this in the new stock market letter EAST STOCK TRENDS (www.eastststok.de). However, you also need to open an account beforehand, which is easy to do at this link: https://trade.mind-money.eu
Andreas Männicke also gives his assessment of the new opportunities in Eastern Europe in this unfriendly environment in his stock market letter EAST STOCK TRENDS (www.eaststock.de) and in his new EastStockTV video, episode 220 at www.YouTube.com.
Will there be a year-end rally despite the war in Israel and the Fed’s restrictive monetary policy?
The mood at the Hamburg Stock Exchange Day on 11 November was mixed. However, the majority of the speakers favoured a year-end rally and a positive scenario for the coming year. The well-known investment guru Heiko Thieme believes in a year-end rally and a DAX of over 16,000 index points. AI shares in particular, such as Microsoft, which even reached a new high for the year, are still in demand. Without AI shares, however, Wall Street would also be in the red with equally weighted indices. Small caps are hardly in demand. There is a lack of liquidity here.
Whether the year-end rally that everyone had hoped for actually materialises depends largely on whether the war in Israel turns into a Middle East war, i.e. whether Iran and some Arab countries as well as Turkey are included in the war or not. French President Macron is in favour of an immediate ceasefire, probably also out of fear that the war between Jews and Arabs will later be fought out violently on French soil. Attacks on Jews have rarely been as high as they are now in France, which is a powder keg, as the largest Jewish community and the largest Arab community are sometimes hostile to each other.
Responding to violence with massive counter-violence can lead to escalation
Mutual hatred is exactly the wrong approach in this situation and will not lead to a solution to the problem. The heinous and cruel attack by Hamas on 7 October, in which over 1,400 people died in a sometimes barbaric manner, is just as condemnable and unjustifiable as the current widespread bombing of hospitals, refugee homes and many civilian homes in Gaza, where over 4,000 children have allegedly already died senselessly. Even if Hamas sometimes uses its own population as shields, such violent action cannot be justified by anything, especially not by the right of self-defence, which is beyond question. International law should set clear and unambiguous limits here and also impose sanctions so that such a mass murder of civilians does not happen again in such a short space of time. The proportionality of the means was not respected here.
The protection of the integrity of life and human dignity may be claimed and claimed equally by both warring parties, especially as far as the peace-loving civilian population is concerned. There must be no differences in terms of religious affiliation. Sanctions should now also be imposed on Israel, but this will not happen. Israel’s settlement policy, which is often violent and contrary to international law, should also be sanctioned and those who criticise this settlement policy should not be slandered as anti-Semites.
As it stands, the war in Israel is likely to keep investors busy until the end of the year or longer and there is still the anxious hope that Iran or other countries such as Turkey will not actively intervene in the war with military force. The war in Ukraine has now faded into the background, but there is also a risk that the war will escalate further and even threaten a third world war if Poland or the UK actively intervene militarily, which is already happening to some extent via mercenaries. Ukrainian President Selinskyi is now increasingly focussing on the deployment of fighter jets and medium-range missiles next year. Russia now seems to be gradually gaining the upper hand in the drone war. In both cases, Western politicians should now call for an immediate ceasefire and diplomatic talks at all levels in order to prevent further escalation and unnecessary mass deaths.
Stock markets have so far reacted calmly to potential escalation risks
So far, the stock markets have been relatively relaxed about both threats of war. However, the Fed’s continued restrictive monetary policy continues to pose a threat. Commercial property in the USA, where vacancy rates are increasing, is also a cause for concern, as are some large European cities. However, investors should also pay attention to the threat of a shutdown in the US from 17 November, which would also weigh on Wall Street and, as a result, the global stock markets. The US rating agency Moody’s issued a negative outlook on US government bonds on Friday because the US budget deficit remains too high.
Bitcoin and AI shares remain in demand, but gold less so
The major global stock markets such as the S&P index and the DAX corrected by over 10 per cent in September/October, but recovered somewhat in November. The DAX40 recently recovered from 14,800 to over 15,300 index points, which represents an increase of over 8 per cent since the beginning of the year. The S&P Index recovered from 4,200 to 4,400 index points in November, which means that the S&P Index is now up 15.5 per cent since the beginning of the year. The NASDAQ index continued to perform best with a gain of 32.8 per cent, although here too only a few AI stocks drove the NASDAQ index upwards. Microsoft, for example, even reached a new all-time high thanks to the “AI fantasy”. Bitcoin continued to be in demand, rising to a new annual high of over 37,000 BTC/USD, an increase of over 120 per cent (!) since the beginning of the year. Gold, on the other hand, corrected again from over 2,000 to just 1,937 USD/ounce due to new interest rate fears.
Eastern European stock markets remain outperformers
The stock exchanges in Eastern Europe also performed very favourably, with many Eastern European stock exchanges clearly outperforming the DAX. One third of the 30 best performing stock exchanges in the world come from Eastern Europe. Eastern Europe therefore remains one of the best and most promising investment regions in the world, although it is still neglected in the media.
More paprika in the portfolio: Budapest Stock Exchange +42 per cent!
The HTX index, an artificial product of the Vienna Stock Exchange for Hungarian shares, has already risen by 42 per cent to a new high for the year of 4930 index points. The PTX index for Polish shares did not fare much worse, rising by 27 per cent, although it only gained momentum again after the opposition’s election victory. The CECE index, which includes Hungary, Poland and the Czech Republic, has also risen by 25 per cent – far better than the DAX or S&P index! The stock markets in South Eastern Europe also performed very positively, which investors can cover with a SETX certificate that has already risen by over 22 per cent. The stock markets in the Baltic region have also developed positively. Note: In bullish phases, there are always significant outperformance opportunities on the stock exchanges of Eastern Europe.
New opportunities in Kazakhstan via Freedom Broker
A good alternative to the Russian ADR/GDR, which are still not tradable on Western stock exchanges due to the mutual sanctions, are now shares from Kazakhstan such as the oil stock Kazmuniagas, the uranium producer Kazatomprom and the two major banks Halyk Bank and Kaspi.kz. But now the gold producer Polymetal and the consumer chain Fix Price from Russia have also been added.
The broker Freedom Finance now enabled direct market access to the stock exchanges in Kazakhstan, which investors should take advantage of. However, some Russian ADR/GRD can now also be purchased over the counter at a discount of up to 50 per cent via the brokers Zerich Securities Ltd. or Freedom Broker, which should pay off in the medium term. These new opportunities were also discussed in Andreas Männicke’s presentation at the Hamburg Stock Exchange Day on 11 November 2023.
Bargain prices for Russian ADRs on the OTC market; buy!
However, more and more companies from Russia now want to switch to the stock exchange in Kazakhstan, as Polymetal did previously, in order to be tradable there again for Western investors. After Polymetal, the Russian discounter Fix Price has now also switched to the stock exchange in Kazakhstan and is now available there for less than USD 3, while the price on the Moscow stock exchange is the equivalent of over USD 4. You can now also buy 10 other Russian ADRs at discount prices of over 50 per cent in some cases on the OTC market via Zerich Securities Ltd or Freedom Broker, which have similar considerations to Polymetal and Fix Price. This should pay off for investors in the medium term. However, you must first open an account either with Zerich Securities Ltd. from Cyprus via the link https://trade.mind-money.eu or with Freedom Finance via the link https://freedom24.com/invite_from/2952896
Some Russian ADRs can now again be converted into original shares if the investor has previously obtained an exemption authorisation from the Bundesbank and opened a rouble account in Russia. It is again possible to open a rouble account through the brokers Zerich Securities Ltd. and Freedom Finance (Freedom Broker).
First inform, then invest
Find out more about the background and development of the Ukraine/Russia crisis as well as the future recovery potential of undervalued shares from Eastern Europe. There are also new opportunities in the Baltic states, south-eastern Europe and the CIS republics (Kazakhstan, Georgia), with the respective share indices all up in 2023. In 2023, 10 stock exchanges from Eastern Europe were among the 30 best-performing stock markets in the world, with 9 clearly outperforming the DAX. It is therefore still worth taking a look beyond the horizon to Eastern Europe after the war in Ukraine.
Order a trial subscription now (3 issues by e-mail for just €15) to the monthly stock market letter EAST STOCK TRENDS (EST) with another Ukraine/Kazakhstan/Russia special and a dividend special as well as lots of background information and new investment suggestions such as the “Share of the Month” and lucrative certificates at www.eaststock.de, under Stock Market Letter. The last EST was published on 30 October 2023.
TV/radio notes: The last radio interview on Börsen Radio Networks was on 2 October 2023, but please also note the new interview by Marco Fröleke with Andreas Männicke on the new investment opportunities in Eastern Europe on his YouTube channel “Die Zeitenwende” from 28 September 2023. You can download all radio and TV interviews in the video archive at www.eaststock.de, including the last video in EastStockTV, episode 220. By the way: have you already subscribed to the EastStockTV YouTube channel?
If you are interested in new EastStock seminars “Go East” in Frankfurt/m or other cities, please contact the EST editorial team (www.eaststock.de )