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Stock exchange loses 2.1 bln euros in two days

More than 2.1 billion euros 'vanished' from the stock exchange market in just two days, amid severe corrections of the quotations recorded on the Bucharest Stock Exchange (BVB) on Tuesday and Wednesday.

The stock exchange capitalisation dropped by 1.368 billion euros on Tuesday, after all the indices sustained 5 to 6 percent losses, with the reduction of the capitalisation amounting to 780 million euros on Wednesday, against the background of corrections of 3 to 4 percent on all indices. According to the brokers, the causes for such a dramatic fall were the negative news about the foreign markets and the psychological effect of 'breaking through' certain support ceilings. The BET and BET-FI indices broke through such support ceilings, with the drop being more pronounced afterwards; on the other hand, it is mostly Romanian investors with an appetite for speculation who operate in the local market, and they look to the foreign markets, the U.S. one in particular, and then they transpose what happens there into the Romanian market. The BVB capitalisation amounted to 26.897 billion euros on Wednesday, while it stood at more than 35 billion euros in mid-June. ROMPRES Further panic and frustration hit Stock Exchange The Bucharest Stock Exchange lost more than 5 percent on Tuesday, the biggest decline of the last three months, after the BET index (which indicates the evolution of the 10 most liquid shares on the market) approached a 3-year low, reads the daily Ziarul financiar. None of the 25 most traded shares managed to close the session with less than a 1 percent loss. Such declines would have been unconceivable for investors a year ago, when the Stock Exchange grew by a few percentage points each day and approached historic highs. In the meantime, the crisis on the international markets and the doubts hanging over the global economy has turned overall optimism into pessimism. Unlike last summer, when the Bucharest market closed 22 out of 33 sessions on a high (between June 1st and July 15th), during the last month and a half the Stock Exchange has seen declines in 22 sessions out of 31. Tuesday's session was the most dramatic and affected companies in the financial sector, which saw the sharpest declines since early June, as well as manufacturers of chemical fertilizers, the only ones that saw gains in the above-mentioned period. The shares of Banca Transilvania (TLV) lost 8.1 percent, despite a 40 percent higher profit reported in the first quarter. SIFs (Financial Investment Companies) also saw declines of around 5-6 percent, while BRD lost 3.7 percent. 'It is natural that banks should be among the most affected, given the problems experienced by the financial sector globally. SIFs are traded at a 100 percent discount, but they do sell. An explanation is the lack of foreign investors, which means the market is currently dominated by Romanians, who have started to panic, as there is no more support on the buying side. Money is no longer coming in from abroad,' explains Liviu Giugiumica, head of UniCredit CA IB Securities. Sursa: http://www.actmedia.ro

Tags: percent stock market euros exchange brd bet bvb

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