Stock markets: weekly report (March 15 - 19)

  • 1999-03-25
Estonia: Industrial shares advance, banks in retreat

Shares in the industrial sector moved higher while those in the banking sector were down on the Tallinn Stock Exchange last week.

The TALSE index fell by 1.56 percent to 116.34 points.

The banks' February results, published March 15, show an improvement in Hansapank's two-month results by 41.1 million kroons ($2.87 million) to 73.6 million kroons and that Uhispank's profit figure went up to 10.1 million kroons.

Over the week, Uhispank stock fell by 4.65 percent to 24.60 kroons and Hansapank stock by 4.31 percent to 83.25 kroons per share.

Trading in Optiva Bank stock was more active than usual, with nearly 8 million kroons changing hands. The price of a share fell by 3.76 percent to 8.95 kroons.

Shares in both the building company Merko Ehitus and the car safety-belt producer Norma moved higher.

"Norma's been assessed after a pessimistic scenario," Sten Sumberg of Talinvest Suprema said. "There is now significantly more optimism concerning the company's future prospects."

Sumberg said that Norma stock continues to be strong. Its price support level should remain at 20 kroons, as sufficient numbers of investors step in to buy below that level, he said.

Speculation around Norma shares pushed its price higher by 6.42 percent to 19.90 kroons, with some trading done at the 21 kroon price level.

Shares in Merko Ehitus rose by 7.22 kroons and closed at 19.30 kroons on Friday.

Shares in Eesti Telekom rose by 0.47 percent over the week, up 0.50 kroons to 107.50 kroons.

Sten Sumberg of Talinvest Suprema said that Telekom benefited from the positive surprise earnings published by the Estonian Mobile Phone Company March 18.

EMT reported a 390 million kroon profit with revenue of 1.36 billion kroons for 1998, a result considerably better than had been expected.

"The EMT results support Telecom's present price level," Sumberg said. But investors are awaiting more accurate information as well as projections for future results. Also expected are results from the Estonian Telephone Company.

Total turnover of the market for the week was 84.7 million kroons. Of this, nearly one-third, or 29.3 million kroons, was from trading in Hansapank stock, followed by Telecom at 12 million kroons and Norma with 11.5 million kroons.

Latvia: Latvijas Gaze sizzles

Latvijas Gaze was the undisputed heavyweight champ on the Riga Stock Exchange last week, its share price up 24 percent to 1.59 lats ($2.69) and accounting for more than half of the bourse's total turnover with a volume of 219,000 lats.

Despite the strong performance of LG, however, the bourse's indexes were left on the ropes; the DJRSE was down 1.92 percent for the week and the RICI 0.09 percent. Latvijas Gaze shares are not included in the index calculations, though.

Shares in the Rezekne Cannned Milk Factory, also not included in the indexes, posted an 18 percent gain to 0.26 lats. This followed the publishing of an audited profit of 204,000 lats, virtually unchanged from the preliminary figure.

Market specialists claim that the rally in LG's share price is due to the March 23 auction of a sizable package of its shares. Investors who were certain of their participation may have been trying to increase their pre-auction holdings.

The jump in the gas company's share price is a boon for employees, who are the most likely ones on the selling side now. Once they have unloaded their positions, trading is likely to abate.

Unibanka shares were stable last week at 0.86 lats. Trasta Komercbanka broker Uldis Bulavs believes the bank's management acted wisely by announcing the 15 million loss for 1998 on Saturday, giving investors time to consider the news and not sell on an impulse. This assumes that the loss was in line with market expectations; if larger, selling should begin on Monday's opening bell.

All banks publish audited results at the end of this month. In mid-April banks will announce first quarter results, giving investors an indication of how well they are recovering from the Russian financial crisis.

Trading in LG and Unibanka accounted for 80 percent of the 400,000 lats in turnover on the bourse last week. Trading in Valmiera Fiberglass and Ventspils Nafta shares accounted for another 8 percent.

Lithuania: Stocks settle into narrow trading range

Investors last week were held captive by the drama being played out between the country's top two private banks — Vilnius Bank and Hermis Bank. Trading volume on the Lithuanian National Stock Exchange took its cue from these developments.

The bourse's indexes ended the week almost unchanged. The official list Litin index was off just 0.11 percent at 569.61 points and the LitinA rose 0.39 percent to 1100.01 points.

The story began immediately after news broke of Hermis' intention to buy Industry Bank. Reacting positively, investors quickly bid up Hermis' share price.

After Vilnius Bank announced it had withdrawn its request to buy a one-half stake in Hermis, investor interest in Hermis' shares subsequently evaporated and its share price sank.

Hermis' Bank was the most heavily traded issue on the central market with 984,000 litas ($246,000) worth of securities changing pockets, followed next by shares in Vilnius Bank with 796,600 litas in turnover.

In direct deals Hermis chalked up 4.34 million litas in trades, followed by Vilnius Bank with 2.963 million litas.

Trading in Rokiskio Suris' shares also perked up with 363,000 litas in turnover. Its share price fell 2.21 percent to 19 litas in the first half of the week and was there to stay.

PFM Hansabank Markets broker Aivaras Abromavicius said the 19 litas price level appears to be a fair value for the company with shares showing good liquidity there. Trading in Lietuvos Energija also picked up, increasing 0.82 percent to 4.92 litas on a turnover of 506,000 litas.