The growth leader in 2021 was the stock market of Mongolia. According to Bloomberg, he overtook American, European and Asian markets.
MSE Top 20 index, which tracks the dynamics of the 20 largest Mongolia companies – the most unclosed country in the world – from the beginning of the year, has grown by almost 130 percent. To date, this is the best indicator among the main stock indexes, the agency notes. This jump Bloomberg compares with explosive growth of cryptocurrency and shares of Gamestop during a coronavirus pandemic.
However, analysts believe that the Mongolian Exchange has great prospects. “The Mongolian stock market has growth potential to heaven, because it grows with a very low base,” said the Vice President for Business Development Erdene Resource Development, a Canadian company, which is engaged in exploration of gold and copper in the country, Billung Anchbayar.
One of the reasons for market growth The Agency calls the active restoration of the Mongolia economy: in the first half of the year 2021, the country grew by 65.3 percent. This is largely due to the neighborhood of China and exports to the neighboring country of commodity, especially copper and coal.
On the other hand, some analysts believe, a sharp jump can be a sign of a bubble. Broker Mongolia International Capital Corp Angarag Biambadzhav suggested that the rally is associated with an excess cash from local residents after government incentives to mitigate a blow from a pandemic and, therefore, may be short-lived. “The market will definitely be corrected. In fact, we think it has already begun. “He commented.
This is not the first time, when Mongolia shares show such good results. The MSE Top 20 control rate grew by 400 percent in 2007, and then another 138 percent in 2010. But at the same time, the Mongol Stock Market recorded several unprofitable years in a row from 2012 to 2016.