Stock markets: weekly report (July 30 - August 6)

Estonia: Share price slide continues

Prices moved south on the Tallinn Stock Exchange during the outgoing week, but Optiva Bank showed resistance and moved strongly against the current.

The TALSE index dropped 1.82 percent to 112.51 points during the week. Hansapank lost 2.48 percent, closing at 78.50 kroons ($5.37) on Friday, while Uhispank was down 2.63 percent to 25.90 kroons.

Sten Sumberg, of Suprema, said that in Uhispank's case interest from a strategic investor provided a firm support level for the share price. Without support from this investor the shares would stand lower now because the bank's half-year results were weaker than expected, he explained.

As opposed to Uhispank, investors view the results of Optiva Bank positively, according to Sumberg. He said Optiva's rise of 12.68 percent to 11.55 kroons was deserved. "Fundamentally, the share has enough support at that level," Sumberg said. He added that Optiva's half-year results had been better than anticipated.

Due to lower quotations in London and changes in the exchange rate of the U.S. dollar, Estonian Telecom dropped 2.24 percent to 98 kroons. Analysts at Uhispank say the price of Telecom is nearing its fundamentally justified level of 96 kroons.

Interest in the EVP privatization securities is still high as investors are preparing for this fall's issue of bonds from the compensation fund, Sumberg said. EVP generated a turnover of 3.6 million kroons during the week, closing at 0.32 kroons.

The total stock exchange turnover, at 44.7 million kroons, was down by 5 million kroons from the previous week. A quarter of the turnover came from deals in Uhispank shares. Deals on Friday brought the week's turnover of Uhispank up by 8 million kroons to 11.5 million kroons. Next, in terms of turnover, came Hansapank with 10.7 million kroons and Norma with nearly 7 million kroons.

The stock exchange quietened on Wednesday, when no issue generated a turnover of more than 1 million kroons and the market's overall turnover was barely 4 million kroons.

Latvia: Another quiet week

It was another quiet week of trading on the Riga Stock Exchange with prices of most major stocks continuing their slide. The RICI price index slid 1.6 percent last week to 164.09 points, while the cap-wighted DJRSE index was off 0.6 percent to 80.95 points. Although the average daily turnover jumped by 20 percent, it still totalled only 35,000 lats ($59,322). Considering the difficult situation in the state budget and other poor macroeconomic indicators, a rebound in share prices does not appear in the cards.

Given the low liquidity in the market, even a small sale offer can push down prices of major stocks. Last week Unibanka's share price slipped 1 percent to 0.98 lats, no doubt due to the concern regarding the general economy as the bank itself has performed well this year. Despite the rise in world oil prices the share price in Ventspils Nafta has not risen. Last week it remained at 0.50 lats. Investors are concerned about greater investment in the terminal given the obscure policy of Russian leaders concerning export routes.

There appears to have been speculative trading with confectionery manufacturer Staburadze's shares at the end of July and beginning of August. At first Staburadze's shares jumped sharply and then last week slumped 9 percent to 1.12 lats on a turnover of just 1,200 lats.

Quick progress on the privatization of the Latvian Shipping Company and the listing of its shares would be a major boost for the market. The possibility of the quick appearance of the shares of such a major company on the market would hopefully bring some much needed interest to the market.

Lithuania: Hermis takes the market

Last week share trading on the Lithuanian National Stock Exchange was directed by direct deals in Bankas Hermis' stock. The Litin-10 price index rose 2.88 percent last week to 1081.83 points and the blue-chip Litin index was up 1.85 percent to 546.63 points. "Trading wasn't very active, and the enthusiasm in the middle of last week has tapered off," Hansabank Markets broker Aivaras Abroma-vicius told the Baltic News Service.

On the central market trading in Vilniaus Banka's and Rokiskio Suris dairy's shares was the most active. Vilnius Bank's shares rose 2.85 percent to 27.05 litas ($6.76) on a turnover of 568,400 litas. "The merger affected the trading of shares - initially everyone focused on Hermis Bank's shares and Vilnius was forgotten for a while," explained VB Vilfima broker Kestutis Kvainauskas.

Rokiskio Suris' share price spiked up 10.48 percent to 25.41 litas on a turnover of 550,000 litas. "The popularity of the share is due to confidence that changes in management will provide better financial performance," said Litimpeks Bank broker Vincas Vanagas.

Trading in Hermis Bank's shares - the overall leader in turnover with 19.8 million litas - was quiet on the central market with just 236,000 litas in trades. Abromavicius said all those willing to buy on the central market have already done so and trading is mostly being conducted in direct deals. Over 19.5 million litas in Hermis' stock was traded in direct deals last week — accounting for almost 90 percent of the shares trading on the bourse — but the share price slid 6 percent to 100 litas.

On the current list, shares in the fertilizer company Lifosa were in the investors' sights. The company's share price plunged 18.48 percent to 22.01 litas on a turnover of 177,700 litas.

Turnover on the bourse totaled 50.42 million litas, but just 2.55 million litas were transacted on the central market.