Since the start of 2025, the composite Wig-Ukraine index of Ukrainian companies on the Warsaw Stock Exchange has risen by 65%. The STOXX Europe 600, a broad measure of the European equity market, increased by 9%, while the key US stock indices, the S&P 500 and NASDAQ Composite, declined by 2% and 5%, respectively.
The price rise for Ukrainian and European assets primarily reflects expectations that the Russian war against Ukraine will soon end. The US economy is on the verge of significant rebalancing reform, and investors are frightened by uncertainty over the ‘readiness of China and the United States for war’
In 1907, British scientist Francis Galton made an intriguing discovery at the Cattle and Poultry Exhibition in the West of England. Eight hundred people purchased tickets for a contest to predict the weight of a bull. Many of the 800 participants were not knowledgeable about cattle. Surprisingly, the average valid estimate from the 787 participants was 1,198 pounds, which closely matched the actual weight of the bull, recorded at 1,197 pounds.
When the crowd is neither rebellious nor blinded by groupthink, it demonstrates greater intelligence than the most exceptional individual. The stock markets always look ahead, and often, market expectations exceed those of opinion polls. If we believe in this, the denouement might be close.
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