EAVEX Weekly

February 06, 2017

Ukrainian stocks listed in Kyiv had a nervous trading week amid the first major escalation of the Donbass military situation in more than a year. Heavy artillery and rockets hit residential areas in the city of Avdyivka, which is on the Ukrainian side of the line and where a strategically important plant for the country’s steel sector is located. The two sides blamed each other for the spike in hostilities. A separate new problem in regard to the conflict zone also emerged when militant Ukrainian groups, including MPs, conducted an unauthorized blockade of a railway line used for transporting cargo to and from the occupied territories. Ukraine’s government still has to rely on coal extracted on the territories, as there is no short-term technical means to switch the entire power generation sector to run on imported coal. Although the negative news flow hit blue chip quotes in the first half of the week, they then recovered after a lull in fighting in the Donbass was announc