The end of the crisis is still far for the domestic capitalmarket, believe some of the biggest investors on the BucharestStock Exchange, and the not at all upbeat outlooks are making themever more cautious about domestic placements or prompting them totry to profit from the bargains emerging on the market.
Sweden's East Capital and Dutch Middle Europe Investments (MEI) arethe most important institutional investors on the Bucharest StockExchange, through the investment funds they manage. Both have losttens of million euros on the domestic market since the onset of thecrisis and although they believe "the worst is not over yet forRomania" they are embracing different strategies for domesticinvestments.
East Capital, with 4.2bn-euro net assets under management andinvestments of around 33m euros on the BSE, is getting ready toprofit from the abnormal asset declines of the Eastern Europeanregion by launching the second "bargain" fund in itsportfolio.
On the other hand, Middle Europe Investments (MEI), which throughRoemenie & Bulgarije Fund (RBF) owns domestic investments ofaround 13m euros, expects foreign investors to be ever morecautious about the Romanian capital market on the economicimbalances.
"(...) Theoretically, European fund absorption should dampeninvestors' concerns about Romania's macroeconomic and structuralimbalances," says Peter Mars, an investment officer with MEI.
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