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Oct 23, 2007 16:54 EEST
SOFIA (Bulgaria), October 23 (SeeNews) – Bulgarian stocks on Tuesday extended the previous day's losses following recent sharp rises but no serious correction is seen up to the end of the year, brokers said.
The SOFIX index tracking the 17 most liquid shares on the Sofia stock exchange lost 0.5% to 1,886.05 points, and the broad BG 40 index depreciated 1.82% to 577.99 points.
“The fall continues despite the good financial results [for the first nine months of the year] posted by most companies (…) because market prices are outpacing financial results,” Severin Vartigov, a portfolio manager at Benchmark Finance, told SeeNews.
Bulgaria’s stock indices have risen sharply since the beginning of the year when the country joined the European Union. The EU entry gave confidence to foreign investors who have since poured significant amounts of money into the stock exchange in Sofia.
Upcoming initial public offerings are also contributing to the overall negative trend as investors drain money from the market to use in the IPOs, Vartigov said. A significant number of local companies have announced plans to go public by the end of the year, with road builder Trace Group Hold seen as one of the most attractive.
Vartigov said he expected the indices to continue fluctuating for a month and gain or lose no more than 5.0% . No deep correction is seen up to the end of the year, he added.
Most shares lost ground on Tuesday with cosmetics producer Aroma being an exception, Vartigov said. Aroma shares surged 30% to a close of 16.65 levs on Monday’s news that blue-chip drug maker Sopharma has bought a minority stake in the company, he said. Some 9,480 shares in Aroma changed hands on Tuesday.
“Investors have great trust in that company [Sopharma],” Vartigov said.
Sopharma lost 0.4% to 8.7 levs in volume of some 40,840 stocks.
On Tuesday, 91 shares lost ground, 69 rose and 10 closed unchanged.
BSE’s turnover fell to 11.9 million levs ($8.6 million/6.1 million euro) from 16.9 million levs on Monday.
BSE's BG TotalReturn30 (BG TR30) index, in which companies with a free float of at least 10% have equal weight, fell 0.84% to 1,170.35. The BG-REIT index, which tracks the performance of real estate investment trusts traded on the stock exchange, edged 0.4% up to 104.25.
The Dnevnik 20 index, calculated by local business daily Dnevnik from the share prices of the 20 leading companies in terms of liquidity and market capitalisation, ended 0.86% lower at 292.52 points.
(1 euro = 1.95583 Bulgarian levs)
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