LJUBLJANA (Slovenia), February 6 (SeeNews) – Slovenia's SBITOP benchmark stock market index is expected to continue to follow until spring the moves of indices on international markets, which dropped on Tuesday following a slump on Wall Street, a Slovenian economic analyst told SeeNews.
"We believe the SBITOP should for now follow global indices. However, in spring time we would expect slightly better results deriving from the SBITOP rather than from global markets", Saso Stanovnik, head of research and chief economist at ALTA Invest, said in response to a SeeNews enquiry.
The SBITOP, which tracks the most liquid and capitalised stocks on the Ljubljana Stock Exchange, fell sharply on Tuesday morning, dropping 2.34% as at 10:55 CET. By 12:54 CET, SBITOP had regained some ground to 814.68 points, down 1.26% from Monday's close.
Stanovnik noted that it is hard to imagine the SBITOP being uncorrelated with the rest of the world, thus a global correction undoubtedly leads to a correction in the SBITOP.
On the other hand, he noted, some things about the Slovenian index are different, suggesting a quicker recovery.
"Firstly, the index constitution is more defensive in the case of SBITOP. Secondly, valuation is relatively lower than global valuations (SBITOP just a bit above 10x P/E). And most importantly, dividends should be strong in 2018 as they were in the last few years, so dividend yield (currently around 5%) should bring some protection in case of any correction or downturn," Stanovnik explained.
Prime market shares on the Ljubljana Stock Exchange fell on Tuesday morning, with logistics company Intereuropa [LJE:IEKG] leading the group with a drop of 4% as at 10:55.
Intereuropa was followed by drug maker Krka [LJE:KRKG] with a loss of 3.45% and insurance company Zavarovalnica Triglav [LJE:ZVTG] with 3.23% decline.
By 12:54, Intereuropa was down 3%, while Telekom Slovenije [LJE:TLSG] had lost 2.51%, Luka Koper [LJE:LKPG] 2.23%, Triglav 1.61% and Krka 1.38%.
In the U.S., the Dow Jones industrial stock market index plunged 1,175 points, or 4.6%, on Monday in a sell-off sparked by concerns of higher interest rates.
Zavarovalnica Triglav d.d. is among the biggest insurers in SEE. You can download our SEE Top 100 ranking
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