A powerful rally led by banking shares helped the Cyprus Stock Exchange General Index wipe out all of its losses in 2009 and move into the black, in tandem with rising global equity markets, which are at 2-month highs.
The CSE General index closed Tuesday at 1102.56 points, recovering from the 37.2% loss since March 6, when the index hit its lowest point for this year at 691.30. For the year, the CSE is now up 0.10%.
The recovery is led by Bank of Cyprus, which since it hit its all-time low of EUR 1.60 is now up 40.5%, closing Tuesday at EUR 2.81, taking its year-to-date performance to 4.5%.
Hellenic Bank is the best performer among the banks, having gained 11.5% since the start of the year, closing Tuesday at this year’s high of EUR 1.16.
Marfin Popular Bank has also recovered but not at the pace of BOC or HB. The stock closed Tuesday at EUR 1.81, which is a 57% recovery from its 1.16 low, but since the start of the year, the share price is still down 6.2% according to Financial Mirror data.
The underperformance is probably due to the decision of Central Bank Governor Athanasios Orphanides to refuse to allow MIG to increase its stake in Marfin Popular Bank, which has dented investor confidence.
European shares pare gains
European and US shares pared gains on Tuesday after data showed that U.S. retail sales and producer prices came in worse than expected in March.
Sales at U.S. retailers fell in March, snapping two months of increases, indicating the recession was far from hitting bottom as mounting unemployment depressed consumer spending.
"With rising unemployment, consumers are clearly cutting back on big-ticket items such as electronics and cars. This is likely to remain the trend as global economies scrabble around trying to find an end to the current woes," said Manoj Ladwa, senior trader at ETX Capital.
London’s FTSE 100 ended mildly up 0.13% at 3988.99, the CAC-40 in Paris was up 0.88% at 3000.22 while the German Dax ended 1.47% higher at 4557.01 points.
Goldman Sachs Group fell 6% after selling shares to help repay $10 bln of government bailout funds. Home Depot and Macy’s declined at least 2.8% as economic data showed job losses forced consumers to cut back spending. Benchmark indexes pared losses as text from a speech showed President Barack Obama will say U.S. stimulus and bailout efforts are starting to “generate signs of economic progress.”
The Standard & Poor’s 500 Index dropped 0.4% to 855.08 in midday New York. The index closed at the highest level since February 9 on Monday amid optimism that bank profits rebounded in the first quarter. The Dow Jones Industrial Average decreased 45.88 points, or 0.6%, to 8,011.93.
The drop trimmed the S&P 500’s advance from a 12-year low on March 9 to 25%. The surge was spurred by lenders from Citigroup to JPMorgan Chase & Co. saying they made money at the beginning of 2009 and Treasury Secretary Timothy Geithner’s plan to finance as much as $1 trln in purchases of illiquid real-estate assets from banks.
Citigroup, JPMorgan and General Electric are among the 31 S&P 500 companies scheduled to announce results this week. Profits probably decreased for a seventh straight quarter in the January-to-March period, the longest stretch of declines since at least the Great Depression.
Morgan Stanley, scheduled to give quarterly results next week, slid 6.4% to $25.17. A measure of financial stocks in the S&P 500 slipped 1.1%.
