Market Overview: NASDAQ OMX HELSINKI 2011, wk.

13
Highlights:
 The OMX Helsinki 25 (OMXH25) index increased by 1.61% over the week
 Finnish paper maker Stora Enso R (STERV) gained 7.2% this week

 The worst performer was Metso Oyj

The Week 13 continues the positive tendencies in NASDAQ OMX Helsinki. Over this week the OMX
Helsinki 25 (OMXH25) has increased by 1.61%, resulting in a closing value of 2659. Similarly like
in the last week, that is the highest value of the week of the OMXH25. There was a remarkable
decrease (0.45%) in the OMXH25 value on Thursday.

Figure 1Changes in the OMXH25 index during the week 13

Overall tendencies are highly affected by the Finland parliamentary election that is going to be held
on April 17. The Central Organization of Finnish Trade Unions published a survey on Wednesday,
according to which over half of its members were ready to stage walkouts. It shows that Finnish
willingness to go on strike has remained high. One of the main reasons for such strikes is
Government reforms to social security, which would be disadvantageous to the workers. At least
2,000 Finnish employees of Nordic telecoms giant TeliaSonera launched a five-day strike on
Wednesday.

This week’s winners are Stora Enso R (STERV) and UPM-Kymmene OYJ (UPM1V), who had
a gain of 7.2% and 6% respectively. The worst performers are Metso Oyj and Orion Oyj.

This week was particularly successful for Stora Enso R (STERV) and its peer UPM-Kymmene
OYJ (UPM1V), Finnish paper makers. Stora Enso opened at €8.11 on Monday and remained
nearly unchanged for the first two days of the week as trading turnover was below-average. The
stock gained 1.19% on Wednesday as Morgan Stanley upgraded its rating from “equal weight” to
“overweight”. A significant increase of more than 3% on Thursday is most likely linked to Stora
Enso’s announcement that Juan Carlos Bueno will be replacing the retiring Nils Grafstrom to head
the Group’s operations in Latin America, and the fact that Sappi Ltd., the world’s largest maker of
glossy paper, said it’s considering closing its Biberist mill in Switzerland, potentially strengthening
Stora Enso’s position in the European paper market. In spite of UMP’s announcement that
Metsahallitus filed a claim for damages against UPM, Stora Enso Oyj and Metsaliitto Cooperative,

1 Market Overview is not an advice. Neither authors nor iFund or other representatives are liable for possible use of information contained in
it. Relatively reliable public information (Exchanges websites, Bloomberg, Reuters, etc) was used to produce this Market Overview.
Market Overview: NASDAQ OMX HELSINKI 2011, wk. 13
the shares continued to advance and gained 3.45% on Friday closing at €8.695, a 7.2% weekly
increase. The legal issue may take its toll on the share price as Metsahallitus demands the three
companies to pay altogether 282.6 million euros for damages due to price fixing in the purchase of
timber. Finland's Market Court has found the companies guilty of price-fixing during 1997-2004.

Figure 2. Development of Stora Enso (STERV) share prices (week 13)

As mentioned earlier, the second top-performing stock this week is UMP-Kymmene OYJ
(UPM1V), another global paper and forest products company. The development of UMP-
Kymmene’s stock prices was nearly identical to its peer’s Stora Enso, as the week started with
modest gains and finished in an end-of-week rally. The shares reacted to the upgrade of Stora
Enso’s rating by Morgan Stanley and Sappi Ltd’s concerns about the Biberist mill and advanced on
Wednesday and Thursday. In the statement issued on Friday morning, UMP reports that it considers
Metsahallitus claims unfounded. Additionally, a Finnish paper reported that Outokumpu, a Finnish
steelmaker, has held talks with UMP about acquiring some of its shares in nuclear projects in the
country. While both Outokumpu and UMP-Kymmene denied this, the news may have had a
significant impact on the price increase on Friday. The shares closed at €15.35, resulting in a 6%
gain throughout the week. The situation of Outokumpu and UMP remains unclear. If the rumors
prove to be true, the shares of UMP could rise even further.

Figure 3. Development of UMP-Kymmene (UMP1V) share prices (week 13)

Despite the threats of strikes, the Finnish stock market continues to grow. We can conclude that the
European and global stock markets have far more influence over the Finnish stocks than its current
domestic troubles. News agencies report that the USA economy is showing signs of recovery as the
unemployment in March was lower than expected and the S&P 500 continues to climb. Assuming

2 Market Overview is not an advice. Neither authors nor iFund or other representatives are liable for possible use of information contained in
it. Relatively reliable public information (Exchanges websites, Bloomberg, Reuters, etc) was used to produce this Market Overview.
Market Overview: NASDAQ OMX HELSINKI 2011, wk. 13
that the trend continues, we are very likely to see further improvement in the European economy
and thus increase in the Helsinki stock index.
Review by: Liene Apsalone, Kārlis Malcenieks, Dmitrijs Sureņans, Justinas Šukys.

3 Market Overview is not an advice. Neither authors nor iFund or other representatives are liable for possible use of information contained in
it. Relatively reliable public information (Exchanges websites, Bloomberg, Reuters, etc) was used to produce this Market Overview.