Enthusiasm is back at Bucharest Stock Exchange, especially amongst brokers, according to Romanian Sentiment Review made by Prognosis.ro. As for investors, indices measuring expectations for indexes at the stock market, maintain in the close proximity of the last month data. The review indicates a positive change in outlook over the next few weeks, and sees no reasons for a comeback to October’s bearish bias.
Mukul Pal, on the inflexion point in November
Mukul Pal, Chief Executive at Orpheus Capitals, brought his contribution to sentiment review of experts and investors at the capital market. There are many ways to read market sentiment.
“There are many ways to read market sentiment. We talked about extreme sentiment readings and their interpretation on prior occasions; too bearish or bullish readings tell us what the market is thinking. RSR readings were extremely bullish at the start of the year, when markets were topping and the readings were extreme negative last month in OCT. The month was also an anticipated bottom for us. We mentioned this in July, when we said that a potential low could still be in, it happened.
The November readings are suggesting that the bottom might have already been in place. The inflexion point between bullish and bearish percentage has already lead to a clear overlap. And a majority of readings are reversing their respective trends, Mukul Pal added.
The 1 month readings are more sensitive owing to the smaller time horizon under study. But the overlap between bullish and bearish series and change in trend is visible both in 1 month and 6 month sentiment numbers.
“Though the absolute readings are still negative, the confidence index calculated from the market pessimism and optimism data also show an inflexion. Market overall still expect little from the next two quarters. We interpret this as positive”,
