June 25, 2024

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Stock market: 4×4 decline with new pressure on banks

Stock market: 4×4 decline with new pressure on banks

By Manos Hechladakis

The bearish streak capped a month of significant volatility that saw a new 13-year high and a corrective trend thereafter, with the market today completing its fourth straight bearish session.

In particular, the general index ended at 1,431.84 points, down by 0.56%, after moving in a narrow range of only 9.25 points.

The trading value jumped to approximately 384.27 million euros due to the quarterly rebalancing of the MSCI indices (about 147 million before the changes), of which 15.9 million were in 12 packages (7.7 million in 3 Eurobank), with a trading volume of 80.6 million pieces.

The banking index also led the day’s decline by -1.29% to 1241.66 points, the FTSE index fell by 0.83% to 3453.87 points, while on the contrary, the average FTSEM index rose by 1.42% to 2345 points.

The week ended with strong losses for DG at -3.1% and Banks at -4.81%.

Thus, the overall rate was finally negative in May at -1.5%, but the banking index, despite the series of declines, maintained a positive signal but only at +0.35%.

On the macroeconomic front, Eurozone inflation accelerated in May to 2.6% year-on-year, slightly higher than analysts had expected (2.5%) but with Greece following a diametrically opposed path as it saw pressures ease strongly to 2.3% from 3.2%. .

It should be noted that the week will end with Fitch’s new decision in the evening for Greek debt (we have placed it in an investment grade rating of BBB- with a stable outlook).

Picture on the dashboard

After an exploratory move in the first hour of trading, the banks, which achieved cumulative sales of 176.4 million due to rebalancing, moved steadily lower while limiting Piraeus’ losses (40 million euros) to -0.6%.

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In the rest of the sector, Eurobank (39.1 million) closed at -1.13%, Alpha at -1.52%, and Ethniki (62.4 million) at -1.7%.

For the second day, Cenergy (1.9 million) tried to provide some support to the market with a 3.81% jump today to €9, lagging behind its parent Biohalco (1.3 million) to +3.4%, while Ellactor followed closely behind (1.2 million). With +2.2%.

ELPE (2.66 million) rose by 0.78%, Aegean (1.3 million) finished at +0.6%, and Mytileneos (33 million) saw a slight increase of 0.3%.

Away from the banks, sellers on the 25th focused on Motor Oil (37.9 million) with -2.4% to 26.06 euros, Jumbo (14.6 million) with -2.2% to 26.4 euros, Titan (4.4 million) with -2.1% to €30.3 and OTE (18 million) by -1.97% to €13.44.

Outside of 25, Optima achieved sales of 24.5 million due to rebalancing with strong gains of 2.04% to 11.98 euros and AIA with 16 million slightly strengthened by 0.61% to 8.26 euros, in the two titles entering the MSCI Small.

In the medium capitalization, Intralot (2.1M) stood out by +5.4%, Intracom (621K) by +6.76%, PPA (1M) strengthened by 3.9% and ADMIE (1.8M) by 1.6%, while Inrrakat remained on Her condition. Unchanged with sales of 2.6 million.

Despite the decline at the DG level, sellers had a slight edge in the overall board picture, with 64 stocks advancing compared to 56 declining stocks.

Artistic image

As Manos Hatzidakis of Beta Securities pointed out, technically, the general index is in a selling phase since it broke 1,450 and 1,444 units respectively and without a long pause. There is still the 50-day moving average, which is moving in the 1434 unit area and does not seem to be taking strong defenses from buyers at the moment.

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Since the oscillators are not at undervalued levels, the bullish reaction scenario is likely to start from lower levels, with the first candidate support level at 1400 units.

In conclusion, Mr. Hatzidakis concludes, although we expect the rate of decline to slow, a decline in transactions will be more convincing to dry up supply, which is a necessary condition for an eventual reaction. Therefore, the sideways movement may continue in the short term towards the first local support levels.

image internationally

At the international level, the rise in bond yields continues to put pressure on Wall Street, which continues to decline today, albeit with limited losses, as inflation data based on the personal consumption expenditures index showed that it stimulates the investment mood.

The Dow Jones was unchanged, the S&P was at -0.15% and the Nasdaq was at -0.4%.

The Personal Consumption Expenditures (PCE) index, which the Fed closely monitors as a more useful measure of inflation, in its structural part (excluding food and energy) and which falls under the central bank’s “microscope”, was 2.8% annually in April. While on a monthly basis, it showed a marginal decline to 0.2%/

Trends are also slightly bearish in Europe, with the German DAX index moving to -0.3%, the French CAC 40 index to -0.05% and the European Stoxx 50 index to -0.1%, while in London the FTSE 100 index rose by 0.4%. .

In the bond market, pressures eased significantly after the PCE data, with the US 10-year bond yield at 4.494% and the 2-year bond yield at 4.883%, while the 10-year Greek bond yield reached 3.638%.

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Finally, the price of oil fell yesterday with losses of 1% as all indicators point to Fed rate cuts remaining slow and continuing with little progress from sellers today, with Brent at $81.8 per barrel and WTI at $77.6. .