GREEK FINANCIAL MARKET

The General Index in Athens Stock Exchange (ASE) closed at 695.75 posting marginal losses of 0.13%, in a low turnover of €16.71mn. The sentiment is very difficult to change before the elections of May 6th and before the announcement of the recapitalization terms.

Economic Releases

Today: Retail Sales (YoY) for February (prior: -8.5%)

Corporate Impacts

• Banks: The Cabinet meeting decided that the final decision on the terms of the recapitalization will be taken at a new Cabinet meeting this week or immediately after the May 6 general elections. They agreed to boost the four major banks (NBG, Alpha Bank, Eurobank and Piraeus Bank) with an initial injection of €18bn to provide them with the necessary capital to remain operational until final decisions are taken. The completion of the bank recapitalization process is likely by the end of the year instead of the end of September.
• Cypriot Banks: Fitch said that that the interconnectedness of the Cypriot banking system and the Greek economy has made them vulnerable to developments in Greece and this will continue in 2012.
• Marfin Popular Bank: According to Phileleftheros, the Cyprus Finance Minister Mr. Vassos Shiarly will ask for cabinet approval to support Cyprus Popular Bank in the event the lender is unable to raise capital through the markets. The bank may need as much as €2.5bn in state support to strengthen its capital adequacy level, while any state help would be provided under strict conditions that include a restructuring plan with branch closures, staff and salary reductions.
• OTE: MSCI will announce the results of its index review on 15 May 2012 and changes will become effective after the close of business on 31 May 2012. It is highly possible for the stock to be deleted from the index, hence 11.5mn shares outflow.

Technical

• FTSE 20 June future: Support levels: 258-252-246. Resistance levels: 272-280-289.

GREEK FINANCIAL MARKET

The General Index in Athens Stock Exchange (ASE) closed at 696.66 posting marginal profits of 0.20%, in a low turnover of €16.66mn.

According to press reports, the Finance Ministry is in talks with the lenders to extend the period of fiscal adjustment by one year to 2015.

Corporate Impacts

• Banks: The The cabinet meeting is planned for today and the government may finalize the technical details underlying the upcoming system recapitalization.
• Alpha Bank: The Extraordinary General Meeting of Shareholders, which was held yesterday, was postponed for May 8, because the required quorum was not achieved.
• OTE: The European Commission has given Greece two months to respond to its concerns about the government’s golden share or face being taken to the European Court of Justice.

Technical

• FTSE 20 June future: Support levels: 262-256-250. Resistance levels: 276-282-289.

GREEK FINANCIAL MARKET

The General Index in Athens Stock Exchange (ASE) closed at 698.03 posting marginal profits of 0.03%, in a turnover of €21.10mn. Greece said that it completed the bond swap that formed part of its second international bailout, restructuring about €199bn of its debt. The final participation rate in the swap reached at 96.9%. The Finance Minister Mr. Filippos Sachinidis said that he is extremely pleased with the results achieved in the PSI bond exchange.The head of the Foundation for Economic and Industrial Research (IOBE) Mr. Yannis Stournaras said that unemployment figures in Greece will reach beyond 20% in 2012 and he added that the BoG’s estimate regarding the country’s GDP contracting by 5% this year was fair.The IIF is expressing concern about the outcome from the May 6 election and the willingness of the new government to apply the fiscal adjustment program Athens has agreed to with its creditors.The trade balance deficit dropped by 27.4% in February this year, bringing the reduction in the first two months of the year to 28.6%, due to the continuing decline in imports arising from the reduction in domestic consumer demand (ELSTAT). ABN declined to swap corporate loans backed by the Greek state for new securities, saying the country’s debt-restructuring process is unclear.

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Corporate Releases

• Today: Alpha Bank EGM

Corporate Impacts

• Banks: According to press reports, the cabinet will discuss about the recapitalization of banks on Friday.
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Technical

• FTSE 20 June future: Support levels: 262-256-250. Resistance levels: 274-280-289.

GREEK MARKET

The General Index closed in new low levels below 700 units for the first time since January at 697.82 posting losses of 0.62%, in a turnover of €22.68mn.

The chief of BoF Mr. Giorgos Provopoulos said that the Greece’s economy will contract by a steeper-than-expected 5% this year. Greece must stick to its reform and fiscal adjustment commitments under a bailout plan agreed with its eurozone partners and the IMF to return the economy to growth.

According to an e-mailed statement from the EU’s statistics agency, the Cyprus’s budget deficit widened to 6.3% of GDP last year from 5.3% of GDP in 2010. The public debt increased to 71.6% of GDP in 2011 from 61.5% in 2010.

Broker Meteorology

• Banks: KBW reduced its price target for NBG to €0.70 from €0.90, for Eurobank to €0.30 from €0.44 and for Alpha Bank to €0.40 from €0.60 (underperform rating). Uncertainties remain on: 1) Additional capital needs from loan exposures (Blackrock and BoG reviews) 2) Possibility to cover some of the PSI+ losses with CoCos 3) Capital treatment of the increased DTA; 4) Conditions for the HFSF non-voting shares (warrants, maturity, etc.) and CoCos. Nomura maintained the target prices for NBG (neutral rating) and Alpha Bank (buy rating) at €3.70 and €2.30 respectively.

Corporate Impacts

• Banks: Moody’s said that HFSF committed funds to each Greek bank for their recapitalization following a 53.5% nominal write down of GGBs. This commitment as credit positive because it paves the way for the recapitalization of the Greek banking system and ensures the restoration of the banks’ solvency.
• Titan Cement: S&P revised its outlook to stable, reflecting that it will be able to sustain solid cash flows and an adequate liquidity profile over the next 24 months. It continues to cap the long-term rating on Titan at ‘BB-‘.
• BoC: It announced annual net loss of €1.37bn from a preliminary €1.01bn, as the final results included a 74% write-down on its GGBs, compared to 60% in preliminary results announced in February. The pre-tax impairment of GGBs, including related hedging costs, amounted to €1.729bn, representing 83% of their nominal value. Excluding the impairment, it achieved a 2% rise in profit to €312mn, unchanged from the preliminary figure. It has increased its group Core Tier 1 capital by €592mn and it aims to complete capital strengthening by June 18 by placing up to €237mn in rights not exercised by their holders.

Technical

• FTSE 20 June future: Support levels: 260-254-248. Resistance levels: 272-280-288.

GREEK MARKET

The General Index closed at 702.17 posting losses of 1.73% in a turnover of €24.13mn, due to the severe losses recorded on the European board.

Greece’s budget deficit reached at 9.1% of GDP in 2011 compared to the revised shortfall of 10.3% in 2010 (ELSTAT).

The BoG Governor Mr. Giorgos Provopoulos is due today to highlight the need for the application of a comprehensive plan for growth and for no further delay in the application of the program Athens has agreed with its creditors in his annual report on the Greek economy.

IMF suggests that a return to the drachma would signal an abrupt change to the lives of ordinary Greeks.

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