- Eastern European stock markets clearly outperforming
The new German Chancellor Friedrich Merz caused unrest in the coalition with his statement that he would lift restrictions on the range of Ukrainian attacks on Russia with German weapons. Ukrainian drones already have a range of 1,200 km, which means they can already paralyse airports in Moscow and other cities, as has often been the case. However, Putin wants to ‘conquer’ a new buffer zone including the cities of Sumy, Kharkiv and Chernigov. The EU has now adopted its 17th package of sanctions against Russia, which is primarily directed against the Russian shadow fleet.
Although Trump continues to seek peace, he is appalled by Russia’s massive drone attacks at this point in time. A lasting ceasefire is therefore still a long way off. One can only hope that Taurus missiles will not soon have a destructive effect in Russia, as this would clearly make Germany a party to the war.
Despite the ongoing geopolitical risks, Polish stocks are now taking off, and for good reason. Poland has the strongest GDP growth in Europe at over 3 per cent. But Hungary is also becoming increasingly popular as an investment location due to its better framework conditions, while investment in Germany is stagnating. The PTX index for Polish equities has risen by 31 per cent since the beginning of the year, the CTX index for Czech equities by 24.7 per cent and the HTX for Hungarian equities by 22.5 per cent, all outperforming the DAX, which is up 20.5 per cent since the beginning of the year.
Germany has one of the highest insolvency rates ever. Budget negotiations are also proving difficult because too much money is being spent on defence and because the interest burden on the state is growing. But the DAX continues to delight investors with new all-time highs. However, it is now also worth taking a look at Eastern Europe, including countries such as Georgia. Andreas Männicke gives his assessment of the new opportunities in Eastern Europe in his stock market newsletter EAST STOCK TRENDS (www.eaststock.de) and in his new EastStockTV video, episode 251, but now also in the new BRICS TV, episode 2, at www.YouTube.com.
Range restrictions lifted – is Merz now sending Taurus missiles to Ukraine?
The new German Chancellor Friedrich Merz caused discord within the coalition when he announced that he would lift the range restrictions on German weapons being fired at Russia. There are many politicians in the SPD who do not want this. It is also unclear whether he now wants to secretly send Taurus missiles to Ukraine. There are also many politicians in the SPD who do not want this.
Heavy drone attacks from both sides – no ceasefire in sight!
Since an unconditional ceasefire as demanded by the EU has not been achieved, the EU has now adopted the 17th package of sanctions against Russia, which is primarily aimed at the Russian shadow fleet. Trump was also angered by Russia’s new massive drone attacks on Kiev and other cities in Ukraine. However, Trump should also take into account that there was a massive drone attack by Ukraine on Moscow, which even temporarily shut down five airports in Moscow. Speaking of range restrictions, Ukraine is already capable of building drones with a range of 1,200 km, some of which have already reached distant areas in Russia. The drone attacks were and are therefore mutual.
Putin now wants to ‘conquer’ a buffer zone
Putin now apparently wants to capture three more cities, namely Sumy, Kharkiv and Chernigov, in order to establish a buffer zone. Russian Foreign Minister Lavrov has now proposed another round of negotiations to present the memorandum from the Russian side in Istanbul on 2 June. These would then be the Russian proposals on how to achieve a ceasefire.
Strong stock market recovery – thanks in part to Trump
While the war in Ukraine continues unabated – as it does in Israel, incidentally – the stock markets continue to rise as if there were no geopolitical risks. Investors are also ignoring the very high levels of debt and high interest rates in the US, which could come back to haunt them in the summer. Moody’s has already downgraded its rating for US government bonds due to high debt and excessive interest payments. As expected, Nvidia reported very good figures on 28 May, which means that at least the AI world seems to be in good shape despite the trade and tariff war. Nvidia’s share price rose by 4.8% to USD 142 and is now not far off its all-time high. The outlook was very cautious, however. A US trade court has now ruled that some sectors must be exempted from the tariffs imposed by Trump. Trump justified the high tariffs on the grounds of an emergency. This is likely to end up before the Supreme Court in the summer.
Eastern European stock markets clearly outperforming
As Trump had previously set tariffs for the UK and China at a lower level, there was a strong recovery on the stock markets worldwide. The DAX even reached a new all-time high of 24,235 index points, while the US indices are now only at the same level as at the beginning of the year. This means that the DAX is now up 20% since the beginning of the year. However, some stock market indices in Eastern Europe performed even better, clearly outperforming the DAX. Gold and Bitcoin also remain in demand, albeit for different reasons.
Polish stock prices take off
The PTX Index for Polish equities has risen by 31 per cent since the beginning of the year, the CTX Index for Czech equities by 24.7 per cent and the HTX Index for Hungarian equities by 22 per cent, all outperforming the DAX, which is up 20.5 per cent since the start of the year. The UTX Index for Ukrainian stocks has risen by 67 per cent this year despite the war. In May, the Polish shares presented in the EAST STOCK TRENDS (EST) stock market letter, such as Kogeneracja (+28%), Shoper (+15%), Voxel (+15%), Benefit Systems (+15%) and Rainbow Tours (+15%), even achieved double-digit percentage gains. The healthcare stock Voxel has even risen by 370% since it was first recommended in EST at the beginning of 2014.
But shares from Hungary, such as Magyar Telekom and OPT Bank, and from the Czech Republic, such as the utility company CEZ, also rose from one annual high to the next. Shares from Georgia, such as Bank of Georgia and Georgia Capital, are also performing well, with new all-time highs and a threefold increase in their share price since the beginning of 2014. Poland continues to have the highest GDP growth in Europe at over 3%. However, Hungary is also becoming increasingly popular as an investment location, not only for China, but now also for German car manufacturers due to its improved conditions.
Get informed before you invest
Find out more now about the background and development of the Ukraine/Russia crisis, as well as the future recovery potential of undervalued stocks from Eastern Europe. There are also new opportunities in the Baltic States, South-Eastern Europe and the CIS republics (Kazakhstan, Georgia), with all the respective stock indices posting gains in 2023. In 2023, 12 stock exchanges from Eastern Europe were among the 30 best-performing stock markets in the world, with five clearly outperforming the DAX. In 2024, 9 stock exchanges from Eastern Europe once again outperformed the market with strong gains. And since the beginning of the year, 4 stock exchanges from Eastern Europe have clearly outperformed the DAX. It is therefore still worth looking beyond the horizon to Eastern Europe.
So why not order a trial subscription (3 issues by email for only £15) to the monthly stock market newsletter EAST STOCK TRENDS (EST) with another Ukraine/Kazakhstan special and a dividend special, as well as lots of background information and new investment suggestions such as the ‘Stock of the Month’ and lucrative certificates at www.eaststock.de, under ‘Börsenbrief’. The last EST was published on 28 March 2025.
TV/radio tips: On 5 February 2024, Andreas Männicke was interviewed by Carola Ferstl on Money Talk about gold, commodities and new opportunities in Eastern Europe. On 5 December 2024, Andreas Männicke was interviewed by Heinrich Leben on Börsenradio Networks about the new opportunities in Eastern Europe, particularly in Ukraine, following the end of the war. All radio and TV interviews can be downloaded from the video archive at http://www.eaststock.de.de, including the latest video on EastStockTV, episode 251. By the way: have you already subscribed to the new YouTube channel BRICS-TV in addition to the EastStockTV channel? Here is the link to the second BRICS TV video: https://www.youtube.com/watch?v=_zN-qTv0xz4
Reading tip: The new issue of VTAD News No. 42 features a detailed report by Andreas Männicke on BRICS as a new investment opportunity. Here is the link to the article: https://www.vtad.de/wp-content/uploads/2024/11/vtad-news-42.pdf
Seminar note: If you are interested in new East Stock Exchange seminars ‘Go East’ or a BRICS seminar in Frankfurt/M or other cities, please contact the EST editorial team (www.eaststock.de). If you are interested in East Stock Exchange webinars and BRICS webinars, please also get in touch.
You can now subscribe to Andreas Männicke’s free newsletter with the latest news about the world and East stock exchanges and the BRICS at www.eaststock.de. Please also register at info@eaststock.de if you are interested in a new BRICS newsletter from Andreas Männicke.