HEX (Helsinki) - Helsinki Stock Exchange Overview

Above: performance of OMXH25 Index over the last month. (source: www.ft.com) 

The telecommunications giant Nokia (NOK1V) was the biggest gainer this week, its share price up by 10.70 per cent. It climbed from 10.85 Euros on Monday to this week’s high of 11.97 Euros on Wednesday, after which it fell again to 11.38 Euros. Overall, Nokia overperformed the OMXH25 Index by about 5 per cent, the Nordic Information Technology Index – by a whole 11 per cent. A reason for the trend may be found in a series of minor positive news that reached investors during the week: Nokia announced that it would be entering the market for connecting laptops to wireless networks in 2009; it had also managed to sell its old facilities in Bochum, Germany. Turning to the more technical side of analysis, we see that the daily volume of trades kept decreasing over the week, and 103 million shares were traded in total, which is 22 per cent less than last week and indicates that the upward trend could be short-lived. Supporting this conclusion, the MACD indicator shows that the share price has started to converge towards its moving average.

This week’s second winner was the international stainless steel company Outokumpu (OUT1V). Its shares closed at 7.98 Euros, which is 26.07 per cent above the 52-week low of 6.33 and makes for an increase of 9.47 per cent over Monday’s opening price. During the first days of the week the share price even had an upward trend, and it reached a high of 8.74 Euros during Wednesday’s trading session, but during the last hours of that day and on Thursday morning the price fell by more than 13 per cent after Outokumpu released lower-than-expected profit estimates for the fourth quarter. However, the share price managed to return to the day’s opening level as Outokumpu presented a plan to improve the company’s profitability. Outokumpu’s share price fell again on Friday; however, at the end of the day it managed to increase above Monday’s opening value. The total turnover this week was nearly 12 million shares, which is twice as much as last week; 5 million of this were traded on Thursday. Technical analysis suggests that Outokumpu will be on a downward trend for the beginning of next week. 
 

Above: performance of OMXH25 Index over the last month. (source: www.ft.com) 

The company UPM-Kymmene (UPM1V), which mainly operates in the pulp and paper industry, was the main loser this week, its share price down by 7.80 per cent to 9.10 Euros. On Friday it set a new 52-week low of 8.98 Euros, which makes for a 35.13 per cent decrease over that period. The week’s decrease was almost entirely due to Thursday, when the shares lost a whole 9 per cent. This was after the company announced that it would fall short of its expected sales and profit figures due to the worsened economic situation. It should be noted that due to shrinking global demand the share price of all the world’s paper firms dropped substantially this week, including that of UPM-Kymenne’s home rival Stora Enso. The weekly trading volume of the company’s shares was roughly 14.6 million, which is 6 million less than last week. The Relative Strength Index shows no major signs of undervaluation, and the MACD indicates a continued downward trend. We can be fairly sure that we will see UPM-Kymenne in the red next week.

The Finnish tyre manufacturer Nokian Renkaat (NRE1V) was the second loser this week.  Its share price dropped by 7.33 per cent, closing at 7.97 Euros. Friday, when the share price dropped by an astonishing 12 per cent, constituted the entirety of the week’s loss, as  the company announced lower expected sales and profit figures for the year. This came on top of Tuesday’s announcement that the company would lay off workers at its Finnish factory next year, and investors were forced to seriously reconsider their valuation of this company. Nearly seven million shares were traded week, which is five times more than last week. Nokian Renkaat has been very stable for the past two months, and it is still profitable despite the recent news and the global slump in the automobile industry. This, coupled with several technical indicators, suggests that we will not see a continued fall of its shares next week.

If anything, this week’s events have strengthened our belief that the markets will continue to fluctuate in their depressed state in the forseeable future. Although some news are still surprising, they mainly tend to be negative ones, such as China’s new trade figures. A non-trending market seems to be forming in the medium to long term, marked by high short-term volatility.