Stock markets: weekly report (July 9 - 16)

  • 1999-07-22
Estonia: Banking stocks lead market

Stock prices rose slightly during the previous week, driven by mixed first half profit figures reported by the banking industry.

The TALSE index rose by 0.37 percent to 117.24 points over the week.

For the second week in a row, Norma's stock has been at the center of attention. On Thursday, Norma released its first half earnings figures for the year, showing a 65.2 million kroon ($4.24 million) profit, sending its price up by 8.5 percent.

Norma showed the biggest price rise for the week - up by 19.40 percent to 35.70 kroons, with turnover second only to Hansapank.

Hansapank, whose stock generated a 26.8 million kroon turnover during the week, published its June profit figure of 43.6 million kroons on Thursday, raising the bank's half-year profit to 234.5 million kroons and further supporting the rising trend of its share price.

Despite Hansapank's positive first half results, it was not enough to make up for weakness early in the week, and the share price ended the week down by 0.30 percent at 82.75 kroons.

Contrary to the Hansapank story, Uhispank's June profit was smaller than expected - 8 million kroons. For the week, these shares lost 4.36 percent and ended at 26.30 kroons.

The construction company Merko Ehitus' stock churned out a turnover of 6.6 million kroons with the share price climbing steadily in the second half of the week, supported by the announcement of a 300 million kroon contract the company won for the building of a Radisson SAS hotel.

Latvia: Share prices slip

Last week prices of the most liquid shares on the Riga Stock Exchange slipped backwards, with both bourse indexes dropping slightly.

The RICI price index was down 0.89 percent for the week at 164.79 and the DJRSE cap-weighted index was off 0.67 percent at 83.86 points. Both continue to test record lows.

Shares in Ventspils Nafta dropped 3.77 percent to 0.51 lats ($0.85). Unibanka's shares shed 2.88 percent over the week to 1.01 lats. Latvijas Gaze's share price slipped 1.76 percent to 1.67 lats.

The drop in the share prices of these three companies is most likely due to the general pessimism of market participants and not as a result of the real performance of the companies, say analysts.

Unibanka's half-year profit of 6.13 million lats is at the upper-end of market expectations, but nevertheless the shares lost ground as investors remain psychologically wedded to last year's crisis.

The change in government is probably to Unibanka's favor, since Finance Minister Edmunds Krastins was a long-time council member and vice president of the bank. In addition, Prime Minister Andris Skele borrowed money from the bank to buy the Ave Lat Group and may entrust its management to the bank during his time in office.

The drop in Ventspils Nafta's share price may be due to the emergence of a competitor on the market - the Butinge offshore terminal, which plans to fill up its first tanker next week. Supporting Ventspils' profit picture is the rising price of Ural crude oil, recently breaking the $19 per barrel level.

The drop in Latvijas Gaze's share price is seen as a result of the current delay and uncertainty in determining how the remaining company's shares still held by the government will be sold. A decision is expected this week on the conditions of the sale.

Shares in Riga Transport Fleet, Riga Shipyard and Valmiera Fiberglass all posted gains, but trading in their shares accounted for just 6 percent of the week's total turnover of 312,000 lats.

Lithuania: Slow but steady trading action

Last week the slow summer trading continued on the Lithuanian National Stock Exchange.

The Litin-10 index finished down 0.51 percent at 975.18, while the official list Litin index climbed 0.25 percent to 505.95 points.

"There are few sellers on the market, just as there are few buyers," noted Aivaras Abromavicius of Hansabankas Markets.

The bourse's turnover totaled just 49.28 million litas ($12.32 million) with 93 percent completed in direct deals.

On the official list, trading was most active with shares in Vilniaus Bankas, generating a volume of 87,800 litas. It announced its half-year profit was 35 million litas, though its share price slid by 0.31 percent to 258.92 litas.

"The price of Vilniaus Bankas' shares have fallen quite considerably and are now quite attractive, but nobody is actively buying them," said Baltic Securities broker Dmitry Dutov.

In direct deals just 52,000 litas worth of the bank's shares were traded.

Shares in Rokiskio Suris jumped 5.02 percent to 20.94 litas on a turnover of 132,400 litas. Abromavicius said investors are hoping that the government will resolve the milk purchase price and export subsidy questions in the dairy industry's favor.

Investors also pushed up Birzai dairy's share price 4.32 percent to 1.93 litas.

"Compared to other shares in other company's, Birzai dairy's share price had already dropped lower," said Suprema broker Arvydas Jacikevicius.