CSE breaks through 5000 level

The Cyprus Stock Exchange index broke through the 5000 level for the first time in seven years, closing Thursday at 5024.35 points, up 2.92% on the day and about 30% higher since the start of the year.

Brokers told the Financial Mirror that the break above the 5000 level recorded in Greece was instrumental in helping shore up confidence in Cyprus, with sentiment further supported by M&A activity and a renewed rally in banking shares.

The announcement by Andreas Constantinou that he intends to submit a takeover bid seeking to increase his stake in Constantinou Bros. (CBH) from 35% to 100%, but no less than 50% plus one share with the support of his brother, Agathoclis who also controls a further 35% at EUR 0.4575 per share gave a nice jolt to the market that there are many M&A deals in the pipeline.

“The CBH bid is lower than the book value of EUR 0.67 per share, but it was at a 43% premium to the previous close on the CSE of EUR 0.32, which helped remind investors that there are many titles trading on the CSE at a discount,” an experienced trader told the Financial Mirror.

A powerful rally by Marfin Popular Bank to a new closing high of EUR 9.92, at a time when Bank of Cyprus managed to shrug off “tactical sales” by MPB and raced to EUR 12.60 helped the overall index higher. Hellenic Bank was also well bid at EUR 4.62.

Sea Star Capital (MEGA) was the third most active stock on the CSE on Thursday on 5.3 mln shares volume, but was stable at EUR 0.50 as another bunch of Cypriot major investors sold their shares to their counterparts in Greece.

Louis Plc was also well bid, closing at EUR 0.55 after its subsidiary revealed that the sale of a hotel in Crete will add EUR 4.8 mln to this year’s profits, leading a number of investment houses to increase their profit target on the group.

Other active stocks with satisfactory gains were Pandora Investments and Tsokkos Hotels, both of which are rumoured to be the subject of takeover bids.