Summary
Although the Romanian capital market had a short breathing moment a week ago with 2% growth for the main BSE index, in the last 5 trading sessions the losses deepened as the most liquid companies dropped more than 30% since the beginning of the year. The beginning of the week was very volatile for most of the international capital markets, as the 5th US brokerage firm, Bear Stearns, capitulated against the financial crisis. In order to avoid the bankruptcy the company`s board approved the buyout by JP Morgan, an offer financed in part by the Federal Reserve. The difference between the offer price (2$/share) and the market price of the Bear shares was pretty high, more specific almost 94%.
Last week FED took several important measures in order to revive the American economy and it cut the discount and the benchmark rate with 0.25 and 0.75 point respectively, it injected more liquidity to support the financial markets and even extended the lending facility to non-banks; the benchmark rate rebate was under most of the analysts`s estimations who expected a 1 point cut. After Federal Reserve financial measures, we witnessed a significant decline of the commodities prices. Since the beginning of the subprime crises, the commodities index, Reuters Jefferies CRB had gained 30% as many investors saw a hedging possibility in gold, oil and other commodities. It remains to be seen if these short comeback period of the commodities prices is due to the optimistic investors` expectations regarding the possible favorable results of the FED` s plan to rescue the American economy and if the investors` strategies will favor the stock exchanges. For the moment, the 0.75 point cut of the benchmark rate lead a lot of discussions about the reasons behind this particular percentage. Is the financial crisis coming to an end and the 0.75 point cut is enough, or the Federal Reserve kept a `reserve` in order to intervene later.
Even if many international financial companies mobilized their efforts for reorganizations, acquisitions or mergers with a view to resist during the financial markets turmoil, on the Romanian capital market it looks like only the negative news are the most influent. Despite the usual high volatility of the Bucharest Stock exchange, the Romanian indices followed closely the international markets. However, on Thursday the main BSE index had one of the deepest corrections, not very correlated with the external trends, as the market reacted to the affirmations of some influent businessmens regarding the futures of the stock exchange. As for the next period we expect the current trend to continue, as without any positive news regarding the national and especially the international economy it is quite hard to see a soon upsurge.
Last Week
Last week BET and BET-C lost 7.95% and 7.30% respectively, while BET-FI went down 8.46%. The average trading volume gained 50.6% to 42.52 million lei daily, while the market capitalization went down 5.21 percent to 110.15 billion lei.
| BVB indices | |||
| indices | Change | Mar 14, 2008 | Mar 21, 2008 |
| BET | -7.95% | 7,449.66 | 6,857.70 |
| BET-C | -7.30% | 5,257.02 | 4,873.40 |
| BET-FI | -8.46% | 57,528.28 | 52,660.71 |
BET (chart)
Top Extremes
Flamingo had the most significant growth of the capitalization, while the company`s shares went up 1.8%. Comelf and Socep were the other `performers` of the week, while the top gainers included even negative performances, as the corrections had a strong impact upon the stock market.
| TOP 5 - CAPITALISATION GAINERS [MRON] | |||
| Symbol | Change | Mar 14, 2008 | Mar 21, 2008 |
| FLA | 3.895 | 214.239 | 218.134 |
| CMF | 0.000 | 140.478 | 140.478 |
| SOCP | 0.000 | 96.159 | 96.159 |
| SRT | -0.318 | 9.669 | 9.351 |
| ZIM | -0.531 | 19.746 | 19.215 |
FLA (chart)
BRD-SG suffered the most serious corrections regarding the capitalisation (1.400 millions lei), on a high trading volume, followed by SNP. The companies shares went down more than 8% on Thursday, together with the most liquid BSE` s companies. According to the communiqué released by the company the management proposed a gross dividend of 0.0191 lei/share, 6.7% higher than the one of the last year.
| TOP 5 - CAPITALISATION LOSERS [MRON] | |||
| Symbol | Change | Mar 14, 2008 | Mar 21, 2008 |
| BRD | -1,463.493 | 14,634.932 | 13,171.439 |
| SNP | -509.797 | 23,903.814 | 23,394.017 |
| ALR | -356.890 | 5,139.210 | 4,782.320 |
| OLT | -283.756 | 3,192.260 | 2,908.504 |
| TLV | -244.422 | 4,674.562 | 4,430.141 |
BRD (chart)
Top Volume
The SIF`s, TLV and BRD-SG were the most traded last week while compared to its total number of shares the most significant trades were conducted with SIF Moldova`s shares, followed by SIF Oltenia.
| TOP 5 - TOTAL VOLUME [RON] | |
| Symbol | Volume |
| SIF5 | 30,222,929 |
| TLV | 26,969,227 |
| SIF2 | 26,648,942 |
| BRD | 20,146,368 |
| SIF4 | 19,026,988 |
| TOP 5 - VOLUME (% of subscribed capital) | |
| Symbol | Volume / Number of Shares |
| SIF2 | 2.06% |
| SIF5 | 1.75% |
| BIO | 1.48% |
| SIF4 | 1.42% |
| TBM | 1.36% |
This year, up until now
Since the beginning of the year BET and BET-C lost 30.20 and 26.89 percent, respectively, while BET-FI is 33.06 percent lower than its level on 21st of December 2007. The SIFs, Banca Transilvania and BRD-GSG had the highest trading volume for this period. The trades with SIF Moldova, Siretul Pascani, SIF Oltenia, SIF Muntenia and broker Cluj had the largest proportion in the companies` capital.
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Copyright: 2006 SSIF Confident Invest Bucuresti SA. All rights reserved.
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Phone: +40 21 320 21 02, fax: +40 21 320 21 03, e-mail: research@confidentinvest.ro, web site: http://www.confidentinvest.ro
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Weekly Update Mar 21 2008.pdf, 74 Kb
