Bulgarian Stocks Plunge on Economic Downturn Fears

The SOFIX index, which includes the 20 most liquid stocks on the Bulgarian Stock Exchange (BSE), plunged 3.72% to 439.74 points, while the broader BG 40 index, which tracks the 40 most traded shares on the bourse, dropped 6.85% to close at 129.58.

Fears of an economic crisis scared away buyers and clients of large funds, Sofia-based brokerage Bulbrokers said in a daily note.

The Bulgarian government has forecast a real economic growth of 4.7% next year, down from the 6.5% expected in 2008. However, industry officials said growth may slow down to 2.0% in 2009.

On Wednesday, losers on BSE outnumbered gainers by 75 to 18, 14 shares ended flat.

All but one of the traded blue chip shares lost ground. The biggest decliner was paint maker Orgachim, which slid 11% to 83.61 levs on a volume of over 500 shares.

The only gainer among the SOFIX components was hydraulic equipment manufacturer M+S Hydraulic. The stock advanced 1.92% to 5.49 levs with only 50 shares changing hands.

BSE's turnover, excluding block and other pre-agreed deals, rose to 2.6 million levs from 2.16 million levs on Tuesday. Bonds contributed nearly 1.0 million levs to Wednesday’ turnover.

The BG-REIT index, tracking the performance of real estate investment trusts, fell 1.0% to 52.62 and the BG TotalReturn30 (BG TR30) index, in which companies with a free float of at least 10% have equal weight, sagged 3.94% to 333.33 points.

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, lost 3.16% to 65.83 points.

(1 euro = 1.95583 Bulgarian levs)