The BET index of the most important companies listed on the Bucharest Stock Exchange reached its highest value for the last four month''s yesterday, despite the political instability of recent weeks, amid larger volumes of trading on the market.
The market has grown by some 10% in the last couple of weeks alone, though is still quite far from the all time highs seen in February.
The total value of companies listed on the market rose by nearly 2bn euros during the last four weeks to a total of 12.6bn euros.
Opinions among brokers differ significantly when it comes to the growth, with some talking of an upward trend, while others put the price rises down to speculative short-term causes.
The growth was driven by the increasing in the SIF stake cap through a government ordinance and by optimistic expectations among investors as to the financial results of companies, especially of those from the petroleum industry. The listed companies are due to publish their half-year results as of next week.
The SIFs rose by 20% last week alone in the wake of the raising of the stake cap from 0.1% to 1%, despite the SIFs also being far from their all time highs, which they reached in February at around 2 RON/share. The most expensive of the five, Transilvania, was trading at 1.5 RON/share yesterday.
Rompetrol Rafinare, which was among the top climbers in the last two weeks, gained 20%, even though the investigation into Rompetrol''s main shareholder, Dinu Patriciu, has not yet been completed. The price of this company''s shares even exceeded the price at the end of March, when Patriciu was called for questioning by prosecutors. One Petromidia share was worth 0.0950 RON back then. It reached 0.0980 RON yesterday.
Petrom is the company that gave the lead in terms of rises on the Stock Exchange at the end of February, after reaching a 0.3050 RON minimum. It has been increasing ever since, gaining nearly 60%. The last price Petrom shares traded for yesterday was 0.4800 RON.
"The typical volatility for this year still persists. I believe we can already talk about a trend reversal, considering the macroeconomic results so far and the individual results of the listed companies. Furthermore, there has been a change in foreign investors'' sentiment towards the developing markets lately, and this has had positive effects, mainly on Central and Eastern Europe," Liviu Giugumica, head of BRD Securities, BRD-SocGen''s brokerage firm, said.
Brokers on the Stock Exchange said a few weeks ago that the market in Bucharest was out of synch with other markets in the region, though this would not last for very long. The Bucharest Stock Exchange was in synch with the other Eastern European markets in the first few months of the year, however, with the growth and the ensuing negative adjustment being felt on the markets of Budapest, Prague and Warsaw. The other markets in the region later resumed growth, reaching new all time highs in the last few weeks, whilst the market in Bucharest stabilised somewhere close to the levels at the end of last year.
"I believe the market trend over the last few days is more a speculative move that came about as a result of positive factors like the government ordinance on the SIFs and the rumours on the market about Petrom''s results. Things may calm down somewhat in the coming months, however, and some of the buy orders may disappear, while the desire to speculate may be reduced," said Valerian Ionescu, head of operations with CA IB Securities. vlad.nicolaescu@zf.ro
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