The secret behind the over 30% increases of Transgaz and Transelectrica

The outlooks of Transgaz Medias (TGN) and Transelectrica Bucuresti (TEL) utility companies and the modest performance of their stock in 2009 turned them into investors' new target, at least for the following period. "The fact that the utilities sector is registering such strong increases does not surprise me because there are enough reasons on the market. First, there's high interest in Transgaz stock amid investors' expectations about the company's taking part in at least one of the two announced projects, Nabucco or SouthStream, or even in both. Moreover, the company reported rising results, very good ones, which again supports the upward trend. Also, both stocks registered consolidation last year for almost nine months and pressure has built upon them," explained Ovidiu Serdean, a broker with IFB Finwest brokerage. Analysts, however, believe we cannot speak of investors shifting to defensive stocks as the most traded stocks on the market are SIFs, and other defensive stocks, such as pharmaceutical ones, are not registering similar trends.