Greek stocks continued to rise for the fourth successive session in the Athens Stock Exchange on Friday, buoyed by a Fitch report upgrading the Greek economy to ‘B’ and an anticipated good outcome in Sunday’s elections, with the market gaining 7.62 pct over the last week. The index ended 1.75 pct higher at 1,171.15 points, for a net gain of 0.73 pct since the start of 2014. Turnover was a strong 162.36 million euros.
The Large Cap index rose 1.78 pct and the Mid Cap index ended 2.83 pct higher. GEK Terna (4.73 pct), Piraeus Bank (4.29 pct), Piraeus Port Authority (4.01 pct) and PPC (3.14 pct) were top gainers among blue chip stocks, while Hellenic Petroleum (-2.60 pct), Frigoglass (-0.86 pct), Korinth Pipeworks (-0.65 pct) and Intralot (-0.50 pct) suffered the heaviest percentage losses of the day.
The Telecommunications (2.64 pct), Travel (2.60 pct) and Banks (2.56 pct) sectors scored the biggest gains, while Oil & Gas (-1.07 pct), Health (-0.42 pct) and Foods (-0.37 pct) suffered losses.
Broadly, advancers led decliners by 82 to 38 with another 25 issues unchanged. Medicon (19.73 pct), AEGEK (18.75 pct) and Proodeftiki (16.16 pct) were top gainers, while Naftemporiki (-9.73 pct), Space Hellas (-8.45 pct) and Leventeris (-8.33 pct) were top losers.
Sector indices ended as follows:
Financial Services: +1.45%
Industrial Products: +1.63%
Real Estate: -0.05%
Personal & Household: +1.51%
Food & Beverages: -0.37%
Raw Materials: +1.41%
Travel & Leisure: +2.60%
The stocks with the highest turnover were National Bank, Eurobank, Piraeus Bank and Alpha Bank.
Selected shares from the FTSE/ASE-20 index closed in euros as follows:
Alpha Bank: 0.66
Public Power Corp (PPC): 10.84
Coca Cola HBC: 16.89
Hellenic Petroleum: 5.24
National Bank of Greece: 2.29
Eurobank Properties : 7.89
Piraeus Bank: 1.70
ADEX closing report
The June contract on the FTSE/ASE Large Cap index was trading at a discount of 0.88 pct in the Athens Derivatives Exchange on Friday, with turnover rising to 30.066 million euros. Volume on the Big Cap index totalled 11,576 contracts worth 23.983 million euros, with 61,850 open positions in the market.
Volume in futures contracts on equities totalled 17,157 contracts worth 6.083 million euros, with investment interest focusing on National Bank of Greece (NBG) contracts (4,068), followed by Alpha Bank (1,253), Piraeus Bank (3,218), Eurobank (2,479), MIG (1,315), OTE (1,434), PPC (1,096), OPAP (352), Mytilineos (466), Hellenic Petroleum (153), METKA (214) and GEK (448).
Greek bond market closing report
The yield spread between the 10-year Greek and German benchmark bonds fell further to 5.11 pct in the domestic electronic secondary bond market on Friday, from 5.15 pct the previous day, with the Greek bond yielding 6.51 pct and the German Bund 1.40 pct. Turnover was a moderate 34 million euros, of which 15 million were sell orders and the remaining 19 million euros were buy orders.
In interbank markets, interest rates mostly moved downward. The 12-month rate was 0.578 pct, the nine-month rate was 0.492 pct, the six-month rate was steady at 0.406 pct, the three-month rate was 0.317 pct and the one-month rate was 0.261 pct.
Foreign Exchange rates
U.S. dollar 1.363
Pound sterling 0.809
Danish kroner 7.464
Swedish kroner 9.060
Japanese yen 138.92
Swiss franc 1.221
Norwegian kroner 8.130
Canadian dollar 1.485
Australian dollar 1.478
**** State budget deficit fell by 52.8 percent in the January-April period, exceeding even the relevant target, according to data released on Friday by the Finance ministry.
The primary reading amounted to a surplus of 1.046 billion euros compared to a deficit of 306 million euros in the same period of 2013.
**** Greece’s current account deficit shrank by 50 pct in the first quarter of 2014 to 1.05 billion euros, compared with the same period last year, the Bank of Greece said on Thursday.
The central bank, in a report, attributed this positive development to higher surpluses in the balance of services and current transfers and a reduction in the income account deficit while the trade deficit remained almost unchanged.
Specifically, regarding the trade deficit, higher net payments for purchases of ships (up by 212 million euros) offset the lower net oil import bill and the slightly contracted trade deficit excluding oil and ships, which is largely due to a decrease in the corresponding import bill. Receipts from exports of goods excluding oil and ships did not change considerably.
The rise in the services surplus (up by 464 million euros) in the first quarter of 2014 is attributable to increased net receipts, primarily, from transport services and, secondarily, from travel and other services. More specifically, travel spending in Greece by non-residents rose by 22% year-on-year, reflecting a 16 pct increase in non-residents’ arrivals; at the same time, residents’ travel spending abroad rose by 16 pct.
The income account deficit fell by 245 million euros year-on-year, owing to a decline in net interest payments.
Finally, the current transfers balance showed a surplus of 2.2 billion euros, up by 518 million year-on-year. This development is mainly due to higher general government net transfer receipts (mainly from the EU).
**** Greek budget recorded a primary surplus of 1.33 billion euros on a cash basis in the January-April period this year, the Bank of Greece said on Wednesday. The central bank, in a report, said that the state budget had recorded a primary surplus of 2.8 billion euros in the corresponding period last year. On central government level, the budget recorded a deficit of 1.27 billion euros in the first four months of 2014, from a shortfall of 5.2 billion euros last year.
Regular budget revenues totaled 14.433 billion euros in the January-April period, up from 13.644 billion euros in 2013, while regular budget spending fell to 16.245 billion euros, from 19.338 billion euros, over the same periods, respectively.
**** Greece’s merchant shipping fleet fell further in numbers but rose in capacity, with the number of vessels falling by 2.1 pct in March compared with the same month last year, Hellenic Statistical Authority said on Wednesday.
The statistics service said that the capacity of the Greek merchant shipping fleet grew 2.2 pct in March, compared with the same month last year.
**** Fitch Ratings on Friday upgraded Greece’s long-term foreign and local currency Issuer Default Ratings (IDRs) to ‘B’ from ‘B-‘ with stable outlook as the most challenging phase of the country’s adjustment is behind it. The issue ratings on Greece’s senior unsecured foreign and local currency bonds have also been upgraded to ‘B’ from ‘B-‘.
Greece achieved a primary surplus in the general government account in 2013, a key target of the EU-IMF programme and an over-performance relative to budget, Fitch said. The “adjusted” primary balance measure used under Greece’s programme registered a surplus of 0.8% of GDP last year. Fitch forecasts the adjusted primary surplus will rise further in 2014 to 1.4% of GDP.
According to the global rating agency, the government is not fully funded by EU and IMF lending over 2014-15, but there are several plausible options for bridging this official funding shortfall. It added that economic data outturns have been encouraging and support the baseline expectation that the recovery will gradually take hold this year. Fitch forecasts GDP growth of 0.5% in 2014, rising to 2.5% in 2015.
**** Piraeus Bank on Thursday announced it has bought back from the Greek state all preference shares issued by the bank, worth 750 million euros. These shares were issued as part of a recapitalization plan which envisaged state participation in the bank.
In an announcement, the bank said that this move was significantly improving the quality of the bank’s capital composition and it was the first step towards regaining the ability to distribute a dividend to shareholders.
**** Spending on R&D in Greece is rising slowly but steadily as a percentage of GDP, based on official data for the years 2011-2012 sent to Eurostat by Greece’s National Documentation Centre – filling a gap of many years in Greece’s statistical records for these indices.
The R&D spend in 2012 came to roughly 1.338 billion euros in 2012, corresponding to 0.69 pct of GDP. The figure for 2011 was slightly higher (1.391 billion euros) but represented 0.67 pct of GDP in that year. The corresponding figures in 2007 corresponded to 0.6 pct of GDP.
Based on spending as a percentage of GDP, Greece ranked 24th among the EU27 in 2011 and rose to 23rd in 2012. In terms of spending in absolute terms, Greece ranked 16th in both years.
Total employment in the sector was around 70,229 people in 2011 and without significant changes in 2012, despite rising unemployment. Around 40 pct of the total was in institutes of higher education, including university hospitals and private vocational training schools. Private enterprise accounts for another 35 pct of R&D spending and the state sector for 24 pct.
This is unlike the distribution in Europe, where the private sector accounts for nearly two thirds of R&D spending and tertiary education just under a quarter, showing that Greek companies lag significantly in this area. The largest source of funding is the state (49.2 pct), with private funding contributing 32.7 pct and Greek participation in EU-funded programmes 11.9 pct.