Yukos deal conclusion highlights uneventful week on markets

Most Baltic stock market indicators declined last week, though they were saved from the sharp drops on European and U.S. markets.

Half of the 14 blue chip Baltic List stocks fell, pushing the Baltic Index down 0.24 percent to 161.25 points.

Nearly all stocks with high liquidity fell on the week, causing the Baltic List's capitalization to drop 1.1 percent to 2.69 billion euros.

Slow trade on all three Baltic bourses pulled the weekly turnover down 50 percent compared with the previous week to 2.13 million euros. Seventy-seven percent of the Baltic List's turnover came from deals with Estonian stocks.

In Tallinn, the TALSE index eased 1.11 percent or 1.93 points over the week to 171.44 points. The price index of Estonian Baltic List shares fell 0.91 percent to 151.44 points.

Total turnover from 278 deals was 33.5 million kroons (2.14 million euros), 56 percent of which derived from Hansapank share transactions. Baltic List stocks contributed 77 percent of the turnover.

"As expected we moved a bit lower," said Jaak Raivo, director of the capital markets division at Uhispank. "In the short term we could sink another 1 percent or 2 percent."

Analysts believe seat belt maker Norma will stabilize but that the biggest market movers - Hansapank and Eesti Telekom - could fall further. Hansapank could drop to the 190-192 kroon range and Eesti Telekom to 67-68 kroons.

Hansapank finished the week 1.56 percent lower at 196.83 kroons on a five-day turnover of 18.7 million kroons, it's lowest since mid-July.

The EVP privatization security was one of the few issues to post gains during the week, ending 0.36 percent higher at 0.8715 kroon on a turnover of 6.24 million kroons.

"This should be EVP's peak for this year," Raivo said. "Whoever wants to sell should use this opportunity."

Activity on the Riga exchange over the week dropped even below summertime levels.

Last week's turnover totaled 79,400 lats (133,200 euros), a third of the previous week's turnover. Baltic List stocks accounted for about half that total.

Share turnover on Sept. 19 alone was a dismal 5,000 lats.

The Dow Jones/Riga Stock Exchange capitalization index fell 0.8 percent to 164.59 points, while the RICI price index was down 0.75 percent to 205.09 points. The Latvian bourse's Baltic List index was down 0.91 percent to 180.89 points.

Shares in the Latvian Shipping Company fell over the past week by 3.33 percent. The company's low profitability and new claims against the legitimacy of the privatization process may be eroding investors' confidence.

Shares in the oil terminal Ventspils Nafta gained 1.66 percent last week after reports appeared in the Russian press that the terminal was negotiating a sale to a Russian oil company. Ventspils officials did not convincingly deny the reports.

With a fairly steep fall in the amount of oil handled by the terminal, it would be safe to assume the company would entertain any serious bids. The question still remains, of course, which companies might be interested and how much they would be willing to pay.

On the Lithuanian bourse, shares in Lietuvos Telekomas fell amid strong selling pressure.

In block trading, Russia's Yukos purchased a 26.85 percent stake in Mazeikiu Nafta from the U.S. energy company Williams International, closing a deal that had been announced last month.

Despite Telekomas' fall the bourse's benchmark price index Litin-10 edged up 1.36 percent to 1278.61 points.

The price index of Lithuanian Baltic List shares climbed 0.68 percent to 159.62 points.

On Telekomas lead, the blue chip Litin index fell 2.21 percent to 278.51 points.

Lietuvos Telekomas generated a weekly turnover of 544,300 litas (157,750 euros). On Sept. 19, Telekomas slid to a record low of 0.85 litas but bounced back. The stock slumped 5.32 percent to 0.89 litas over the week.

Market observers say Telekomas continues to lose ground because of investors' fears that the government's plans to sell its stake in the company to compensate restituted property claimants.

Due to the Mazeikiu Nafta deal, the week's equity turnover reached 269.920 million litas. Baltic List securities trading accounted for less than 1 percent of the turnover.

On Sept. 19, some 190,000 shares in Mazeikiu Nafta, representing a 26.85 percent stake, changed hands in a block deal worth 265.943 million litas, or 1.4 litas a share with a nominal value of 1.0 litas.

The U.S. energy company Williams International sold the shares in Mazeikiu Nafta to Yukos Finance, a subsidiary of the Russian oil company Yukos, which has raised its stake in the Lithuanian company to 53.70 percent following the completion of the deal.