Bloomberg News

Stocks in Greece Rally to One-Month High After Election

June 18, 2012

Greek stocks rallied to a one-month high after pro-bailout parties obtained more than half the seats in national elections, easing concern the country will leave the euro currency union.

National Bank of Greece SA (ETE), the country’s largest lender, and EFG Eurobank (EUROB) Ergasias SA, jumped at least 11 percent. Hellenic Telecommunications Organization SA, Greece’s largest telephone company, gained 11 percent.

The ASE Index (ASE) advanced 3.6 percent to 580.67 at the close of trading in Athens, after earlier rising as much as 7.2 percent. The gauge surged 10 percent on June 14, the second- biggest rally since 1990, amid speculation that the New Democracy party would lead the next government. The measure has climbed 22 percent since tumbling to a 22-year low on June 5.

The election outcome “makes the formation of a pro- European government more likely, removing political uncertainty in the short-run,” Panagiotis Kladis, an analyst at National Securities SA in Athens, wrote in a note today. “Banks could move further upwards this week, although this has been discounted to some extent towards the end of last week.”

The New Democracy and Pasok parties won enough seats to form a majority in the 300-member parliament, according to the vote count posted on the Greek Interior Ministry’s website, easing concern that Greek voters would reject the austerity measures needed to qualify for international aid.

Coalition Bid

“The Greek people expressed their will to stay anchored with the euro, remain an integral part of the euro zone and honor the country’s commitments,” New Democracy’s Antonis Samaras told supporters in Athens yesterday before beginning his second bid in six weeks to form a coalition. “There is no time for petty politics.”

Fitch Ratings said New Democracy’s victory removed the immediate risk that the ratings company will cut the credit grades of euro-area countries.

“Fitch will not place all euro-zone sovereigns on rating watch negative as it had indicated would be the case if a Greek euro exit were a probable near-term event,” Fitch said in an e- mailed statement today.

National Bank gained 11 percent to 1.50 euros, the highest since May 10. Eurobank, Greece’s third-largest lender, surged 15 percent to 80.3 euro cents, gaining for a ninth day. Alpha Bank SA climbed 5.2 percent to 1.42 euros.

Hellenic Telecom (HTO), which is 40 percent owned by Deutsche Telekom AG, rallied 11 percent to 1.86 euros,

State-owned companies that are part of Greece’s asset-sales plan also rallied. Piraeus Port Authority (PPA) SA added 2.8 percent to 8.53 euros. Water utilities Athens Water Supply & Sewage Co. SA and Thessaloniki Water Supply & Sewage Co. rose 3.1 percent to 2.70 euros and 6.5 percent to 3.13 euros, respectively.

Opap SA (OPAP), Europe’s largest publicly listed gambling company, gained 12 percent to 4.36 euros, while Public Power Corp., Greece’s biggest electricity company, advanced 6.2 percent to 2.07 euros.

To contact the reporter on this story: Tom Stoukas in Athens at

To contact the editor responsible for this story: Andrew Rummer at

The Good Business Issue
blog comments powered by Disqus