Stocks ended higher on the last trading session of the week at the Athens Stock Exchange, led by gains in bank shares. The composite index of the market rose 0.99 pct to end at 2,033.76 points, with turnover a moderate 221.158 million euros.
The FTSE 20 index jumped 1.66 pct, the FTSE 40 index ended 0.71 pct down and the FTSE 80 index fell 0.80 pct. The Financial Services (2.96 pct) and Banks (2.47 pct) scored the biggest percentage gains of the day, while Telecommunications (1.73 pct) and Chemicals (1.64 pct) suffered losses.
Elfico (11.96 pct), Lanakam (10.0 pct), Paperpack-Tsoukaridis (9.52 pct), ELBE Clothing (8.43 pct) and Attica Publications (8.24 pct) were top gainers, while Desmos (18.18 pct), Compucon (11.11 pct), Altantic (9.23 pct) and Pairis (9.09 pct) were top losers. Broadly, decliners led advancers by 102 to 70 with another 62 issues unchanged.
Sector indices ended as follows:
Oil & Gas: -0.91%
Personal & Household: -1.23%
Raw Materials: -1.46%
Travel & Leisure: +2.14%
Food & Beverages: -0.62%
Financial Services: +2.96%
The stocks with the highest turnover were National Bank, OPAP, Alpha Bank and Eurobank.
Selected shares from the FTSE/ASE-20 index closed in euros as follows:
Alpha Bank: 6.95
Public Power Corp (PPC): 12.51
HBC Coca Cola: 16.00
Hellenic Petroleum: 8.43
National Bank of Greece: 16.60
EFG Eurobank Ergasias: 6.44
Bank of Piraeus: 6.40
ADEX closing report
The March contract on the FTSE 20 index was trading at -0.42 pct in the Athens Derivatives Exchange on Thursday, with turnover rising further to 137.339 million euros. Volume on the Big Cap index totaled 23,483 contracts worth 117.098 million euros, with 25,637 open positions in the market.
Volume in futures contracts on equities totaled 22,102 contracts worth 20.241 million euros, with investment interest focusing on National Bank’s contracts (7,120), followed by Eurobank (1,754), MIG (578), OTE (689), OPAP (771), Piraeus Bank (1,272), GEK (1,378), Alpha Bank (2,593), Marfin Popular Bank (1,974) and Cyprus Bank (1,087).
Greek bond market closing report
The yield spread between the 10-year Greek and German benchmark bonds widened further to 301 basis points in the Greek electronic secondary bond market on Friday, from 291 bps the previous day, with the Greek bond yielding 6.21 pct and the German Bund 3.20 pct.
In interbank markets, interest rates were largely unchanged. The 12-month Euribor rate was 1.24 pct, the six-month rate 0.99 pct, the three-month rate 0.67 pct and the one-month rate 0.43 pct.
Foreign Exchange rates
U.S. dollar 1.417
Pound sterling 0.876
Danish kroner 7.502
Swedish kroner 10.218
Japanese yen 130.17
Swiss franc 1.484
Norwegian kroner 8.210
Canadian dollar 1.485
Australian dollar 1.558
*** The building materials’ cost index rose 1.0 pct in December 2009, compared with the corresponding month in 2008, after an increase of 4.0 pct recorded in December 2008, the National Statistical Service announced on Friday.
The statistics service, in a report, said the index fell 0.7 pct on average in 2009, after an increase of 6.4 pct in 2008.
**** Greece must not be allured by the “Sirens” calling on it to withdraw from the eurozone, since it is from within the eurozone that it will be able to more effectively tackle its problems, Bank of Greece (BOG) governor George Provopoulos stressed in an article appearing on Friday in the Financial Times.
Responding to those who suggest that withdrawal from the single currency (euro) and devaluation of the new ensuing national currency “would be like waving a magic wand, thereby restoring competitiveness”, Provopoulos said that they do not take into consideration the experience of the recent past.
Indeed, Provopoulos pointed out, Greece actually did “wave the magic wand” twice, with substantial devaluations of the then national currency, the drachma, in 1983 and 1985, but “the devaluations were followed by higher wage growth and inflation, with no sustained improvement in competitiveness”, due to the absence of long-lasting structural adjustment and sustained fiscal contraction.
At any rate, such a choice would have the opposite results of those sought, as it would lead to a rekindling of inflation, further increase in lending interest rates, and a big increase in the cost of servicing the state debt, thus undermining the fiscal adjustment, Provopoulos warned.
The Greek economy, he said, is currently at a crossroads, and “the fact of the matter is that it will be immensely less costly for Greece to eradicate its problems from within the eurozone”.
“Rather than a Greek tragedy, a more appropriate analogy for the Greek economy stems from Homer’s Odyssey. In that epic, the enchanting sounds of the sirens enticed sailors to jump to their deaths in the sea. Those who suggest Greece might leave the eurozone are like Homer’s sirens. Greece will not be tempted by these short-term options, but will undertake the necessary, bold adjustments. The future of its economy is unwaveringly tied to the mast provided by the euro,” Provopoulos concluded.
***** Greek banks have managed to maintain their profitability, although profits fell significantly in the past year, despite the effects of an international crisis, Eleni Dendrinou-Louri, vice-governor of the Bank of Greece, said on Thursday during a Financial Times’ conference here, focusing on the future of the Greek banking system.
In her address, Louri underlined that Greek banks’ liquidity levels were better off compared with other European countries, with the help of a state support program, while he expressed her optimism that liquidity will return to pre-crisis levels. She stressed, however, that difficulties still remained, adding the country’s fiscal situation, and said banks should be very careful, maintain significant capital margins and adequate liquidity, while they should strengthen their risk management culture.
A reform of the banking regulatory framework was currently underway in a European level, integrating all significant lessons learned from recent developments, the Greek central banker said, underlining the significance of these changes as priorities for financial organizations.
Gkikas-Hardouvelis, chief economist and head of research Eurobank EFG, underlined that the crisis highlighted the long-term problems of competitiveness and lack of fiscal discipline in the country, but noted that credit rating firms were exaggerating in their reports over the Greek economy. He predicted that 2010 would be a year of light recovery, with unemployment and bad debt problems still at the forefront.
**** Greek banks entered the crisis from an advantageous position, enjoying high capital adequacy and liquidity ratios while they have been supported by the Greek state during the crisis, Economy, Competitiveness and Shipping Minister Luca Katseli told a Financial Times’ conference in Athens.
The Greek minister stressed it was time that the government and the banking system work in coordination to support the real economy and together to develop new funding models, opening new markets and expanding their presence in Southeastern Europe.
The key to Greek banks’ competitiveness is upgrading internal banking supervision systems, control and risk management, Katseli said, while she referred to the creation of a Refinancing Fund, currently under formation, to ensure liquidity in the country’s real economy.
Commenting on the government’s growth program, the minister said it was a road map for the reconstruction of the country. The Public Investments Program totals 10.3 billion euros for the year, or 4.2 pct of GDP, with the aim to gradually rise to 5.0 pct of GDP in 2013, she said. Katseli said the government was changing a regulatory framework to contain the high cost of investments in the country, by simplifying set up, licensing and operation procedures of enterprises.