EUROCORP

Financial Morning News 28/11/2012

GREEK FINANCIAL MARKET

The General Index in Athens Stock Exchange (ASE) closed at 847.06, posting profits of 0.29%, in a turnover of €92.24mn. The bank stocks recorded heavy losses, due to the Eurogroup decisions regarding the bond buyback process.

The German Finance Minister Wolfgang Schaeuble said that the eurozone partners will consider a further reduction to its debt if Greece meets its target of achieving a significant primary surplus by 2016.

Τhe Organization for Economic Cooperation and Development predicted in its economic outlook that the Greek economy will not recover before 2015, after seven consecutive years of recession. It expects the economy to shrink in 2014 by 1.3%, revising its earlier estimate for growth of 0.2%. The OECD sees public debt rising to 189% of GDP next year and to 195% in 2014 unless additional debt reduction measures are taken, from 177% in 2012. The budget deficit is expected to end up at 6.9% this year and drop to 4.6% in 2013.

The German Bundestag (lower house) will debate the Greek issue this week and vote on Friday to approve the agreement on reducing Greece’s debt burden. The Dutch parliament must also endorse the deal, but we dot not expect any problem. The French parliament will also have to approve the deal, but it will do so as part of a vote on the 2013 budget. In other euro zone countries, including Slovakia, which held up the first international bailout for Greece two years ago, no parliamentary vote is required on the package (Reuters).

Corporate Impacts

  • PPC: The Company posted a 30% nine-month profit increase to €118.1mn from €90.8mn, as settlement of a financial dispute with Depa and lower staff costs helped to offset higher fuel expenses. The cost of liquid fuel, natural gas and energy purchases rose to €2.45bn from €1.7bn a year earlier. Sales increased 8.7% to €4.56bn. Mr. Zervos said that the company forecast is that 2012 EBITDA will be 17.5% to 18% of revenue, based on sales of €6bn and taking into account effects of prolonged recession and lack of cash.
  • OPAP: According to Kathimerini, the Eurogroup deal reached on Greece’s funding and debt appears to have prompted the state privatization fund (TAIPED) to pick up the pace, as its board will today draft the short list of participants in the sale process for a 33 percent stake in gaming company OPAP. Sources suggest that all eight companies and consortiums that have expressed an interest in the process are expected to be short-listed for the second round, which concerns the submission of binding offers.
  • Technical

    FTSE 20 December future:

      Support levels: 292-286-280. Resistance levels: 310-316-322.

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