After many months during which foreign investors bought millions of dollars worth of shares on the Bucharest Stock Exchange, exceeding the number of shares sold, April ended with negative net foreign investment.
Sales of shares by non-residents exceeded share purchases by $0.4 million last month.
Net foreign investment (purchases minus sales) on the Bucharest Stock Exchange had gained $6.1 million one month previously.
The Stock Exchange in April gave brokers the impression that growth had stopped. The BET index, which gauges the performance of the blue chip companies most attractive to foreign investors, fell 9%.
The BET-C, which gauges the entire market, registered an insignificant fluctuation, while the SIFs (financial investment companies), which are among the investors' darlings, caught up with the other stocks and rose 33%.
Last month's decline in foreign investment seems to be purely coincidental, particularly because overall growth returned to the market. The BET went up 1.5% on Wednesday alone.
"I haven't seen much money coming in last month, but I don't think there's a clear explanation for this; I believe it's just a coincidence," a broker suggested on Wednesday.
Rompetrol Rafinare (Petromidia) became available for trading last month, nearly doubling the market trading values, which reached $69 million compared to $37 million in March.
However, the proportion of foreign investors relative to total purchases remained within the previous months' levels, standing at approximately 27%. In other words, the money used to buy shares came from the sale of other shares.
Several million dollars worth of Petromidia shares were sold, notably by Rompetrol SA (Vega) and SIF Transilvania, with foreign investors buying most of them. Major financial groups like Citibank, Erste Bank, Bank Austria Creditanstalt or DZ Bank have become some of the most important minority shareholders of the oil company by trading either for their own accounts or for those of their clients.
These institutions are more like custodian banks, which means they take care of their clients' stakes.
Foreign investors last month sold four times more than in the month before, parting with $22.7 million worth of shares.
Many of the shares sold were those issued by banks, as certain analysts felt BRD (Romanian Development bank) and Banca Transilvania were trading too high in comparison to their financial results. The shares of the two banks showed the clearest signs of a downward trend last month.
Brokers say that, despite strong growth since the beginning of the year, most of the shares on the Stock Exchange remain attractive to foreign investors.
vlad.nicolaescu@zf.ro
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