Baltic stock exchanges in positive trend

Most of the Baltic indexes moved up over the week as a result of the falling euro exchange rate against US dollar, supported by rising Latvian and Lithuanian blue-chip shares. The Baltic Index, comprising 15 Latvian, Lithuanian and Estonian blue-chip stocks, grew 3.05 percent to 122.58, a new all-time record high. Contrary to Latvia and Lithuania, the prices in Estonia moved mostly downwards. Moreover, the falling euro exchange rates did not affect the Estonian indexes either.

The Baltic List weekly turnover fell short of last week's figure but still was rather impressive at 11.8 million euros ($10.27 million). Estonian stocks accounted for 7.9 million euros or 67 percent of the total turnover, Latvian stocks contributed 1.67 million euros, or 14.16 percent, and Lithuanian stocks 2.2 million euros, or 18.7 percent.

The Baltic List stocks accounted for more than 70 percent of the total turnover on their respective home bourses.

The Baltic List capitalization gained an additional one percent over the last week, to 3.22 billion euros. As of Sept. 8, the capitalization of Estonian Baltic List stocks was 1.85 billion euros (-2.1 percent), for Latvian stocks it was 517 million euros (+5.2 percent) and for Lithuanian stocks 851 million euros (+4.8 percent).

Key shares down in Tallinn

The price levels of most key shares fell on the Tallinn stock exchange in the outgoing week, and the TALSE stock index closed 1.55 percent down at 144.21. The index received a boost, however, from shares in Tallinna Kaubamaja, which rose 5.15 percent to 51 kroons ($2.84).

Trigon Securities broker Kristel Kivinurm said Hansapank stock was under local profit-taking pressure almost throughout the week. "If last week the price went up along with big turnovers, then this week it came down with relatively small turnovers," the broker said.

Over the week, the price of Hansapank stock dropped 3.3 percent to 131.75 kroons on turnover of 30.4 million kroons. "We will see next week at what level Hansapank stabilizes," the broker said. "Probably it will stop either at 130 or 128 kroons."

Shares in Eesti Telecom were relatively strong thanks to the strong dollar, Kivinurm said. But even so, Telekom lost 1.88 percent off its price over the week and ended at 104.25 kroons. The telecommunications sector of Central and Eastern Europe is still rather weak, the broker said. "If there is no price change there, Eesti Telekom will tick down a little next week," Kivinurm forecast.

Trading in Eesti Uhispank stock generated the week's biggest turnover of 80.4 million kroons, with its share price up, to 37.70 kroons. "Shares in Uhispank have been bought by investors who invest in debt instruments," Kivinurm said. "The share promises a relatively good productivity at price levels from 37.20 kroons to 37.70 kroons."

After takeover offers to Uhispank and Reval Hotel Group some of the money has passed also into EVP privatization vouchers, Kivinurm said. In the outgoing week, deals with EVP vouchers generated 6.3 million kroons of turnover, while the price of the vouchers climbed 2.35 percent to 0.57 kroons. "EVPs will probably continue at the same level or rise a little next week," Kivinurm forecast. "In the perspective of a couple of months, the vouchers will continue their quiet rising trend, which died down in the summer. The beginning of September activates people who need EVP vouchers for privatization."

The total turnover on the stock market was 163 million kroons in the outgoing week, 120.5 million kroons less than the previous week.

Prices continue upward move in Latvia

The upward trend continued on the Latvian market last week, with trade more brisk as well. Dow Jones Riga Stock Exchange capitalization index (DJRSE) moved up 2.8 percent, to 125.17 points over the week. The capitalization index was boosted mostly by rising prices for Latvijas Gaze shares. The gas company shares soared 6.7 percent to 3.03 lats ($4.91) over the week while the growth in euros was 8.71 percent to 5.63 euros. It is an all-time high for shares in Latvijas Gaze both in lats and euros. Experts do not rule out the possibility of further growth, as it is evident that Latvijas Gaze shares are being bought by one of the company's current investors, who seeks to increase their holdings ahead of another auction of the state-held shares in the company.

Although the latest statement said that from 2 percent to 8 percent in Latvijas Gaze will be put up for the auction, the difficulties with implementation other upward driving force for the index in euros. Therefore shares in Balta insurance company and Latvijas Unibanka which posted only marginal gains in lats were able to rise considerably in euros - by 4.76 percent to 6.12 euros and by 3.55 percent to 3.5 euros, respectively.

The current price for Latvijas Unibanka's shares (1.88 lats) still seems to be rather attractive for investors, who expect to profit on the spread, when SEB begins to buy these outstanding shares at 1.90 lats per share. It also explains why Latvijas Unibanka last week led the stock market by turnover - 729,000 lats, or 80.3 percent of exchange's total turnover. Buying interest in these shares, however, is bound to dry up almost completely at any price higher than 1.90 lats, if it appears that SEB remains firm in its offer price.

Contrary to the Baltic Index and the DJRSE capitalization index, the price index RICI slipped 1.26 percent to 174.18 over the week. The price index was brought down by significant losses of stocks quoted on the secondary list of the Riga Stock Exchange, including Liepajas Metalurgs metallurgy plant, Daugavpils PKR motor chain plant and Valmiera Fiberglass.

The weekly turnover on the Riga Stock Exchange reached 1.21 million lats.

Lithuanian markets strong

The Lithuanian stock exchange saw strong trading activity in the outgoing week. All bourse indexes ended the week in positive territory, although prices saw a slight correction on Friday. The bourse's benchmark price index Litin-10 rose 6.71 percent to 1053.03, the blue-chip Official List index Litin firmed 2.16 percent to 486.82, and the secondary Current List index Litin-A climbed 4.71 percent to 1082.37.

"Trading was very active at the start of the week. There were few sellers, and everybody was looking to buy shares, so they were buying almost at random," Dmitrijus Dutovas of Baltic Securities said. "But it is still unclear whether the trend will continue, or things will quiet down. We have been talking about a more serious recovery lately. The next week will show (if the forecasts are correct)," he added.

Lietuvos Telekomas and Vilniaus Bankas led trade on the Official List. Telekomas ended the week 1.6 percent higher at 2.56 litas ($0.64) on an active 4.24 million litas turnover, and Vilniaus Bankas was up 1.52 percent to 38.98 litas on 3.53 million litas turnover. Brewer Kalnapilis charged ahead by 7.21 percent to 3.27 litas on 44,500 litas turnover. Cheese maker Rokiskio Suris, the only loser amid blue-chips, slid 1.79 percent to 20.81 litas, on thin turnover of 5,800 litas.

On the Current List, energy utility Lietuvos Energija stayed flat at its usual 5.00 litas on 176,700 litas turnover, linen textile firm Linas rose 12.50 percent to 0.63 litas on 131,900 litas turnover, gas firm Lietuvos Dujos leapt 13.00 percent to 1.13 litas on 117,400 litas turnover, and electronic component maker Vilniaus Vingis surged 34.55 percent on 114,400 litas turnover. Lithuanian Shipping Company (LISCO) jumped 12.12 percent to 1.85 litas on 81,400 litas turnover. Oil concern Mazeikiu Nafta shot up 25.81 percent to 0.78 litas on 77,500 litas turnover amid signing an oil supply deal with Russian Yukos.

The equity turnover on the bourse came to 8.76 million litas.