Although the approval was fully expected, market reaction to the new IMF loan was strong: the benchmark UX stock index surged 3.5% to 2094 (+43.9% YTD) and Ukraine’s sovereign Eurobond curve (UKRAIN) tightened, while 5-year Ukraine CDS spreads look to have already priced in the IMF decision back in early July. Stock market gains were front- and end-loaded, with late-day gains domestically coming even as US indices stumbled on underwhelming earnings from tech and consumer companies.

Locally, blue chips were led higher by another strong day for Stirol (STIR UK) +8.0% and the Metinvest trio of Enakievo Steel (ENMZ UK) +7.5%, Avdiyivka Coke (AVDK UK) +6.7%, and Azovstal (AZST UK) +4.3%. Centrenergo (CEEN UK) +4.9% and Ukrnafta (UNAF UK) +4.2% also performed well. Volumes on the Ukrainian Exchange picked up sharply yesterday, nearly doubling to over US$ 12.5mn. Sugar producer Astarta (AST PW) also had a strong day in Warsaw, adding 3.6%, but on thinner volumes.