Bank of Cyprus is leading a major a recovery in Cyprus stocks, pushing the CSE index to an 18-week high, with analysts baffled at why Cyprus banking shares are racing higher at a time when European and major market advances have stabilised, ended or even reversed.
Bank of Cyprus (BOCY) closed yesterday at EUR 3.35, taking its gains since the beginning of the year to 24.5%. The shares of Cyprus’ largest lender have more than doubled since they hit an all-time low of EUR 1.55 in early March.
The gains scored by Bank of Cyprus have been instrumental in helping the Cyprus Stock Exchange main index to a closing high of 1255 points, taking its year-to-date gains to 14%, as tracked by the Financial Mirror.
Hellenic Bank (HB) is the next good performer, bouncing up nearly 13.5% since the start of the year with a close of EUR 1.18 on Tuesday. Cyprus’ second largest lender, Marfin Popular Bank is up only 3.6% since the start of the year having closed at EUR 2.00.
London up 2%
London's FTSE 100 index of leading shares gained 2% to its highest levels since mid-January on Tuesday, boosted by surging banking shares. "The FTSE 100 has now rallied 25% in just under two months' trading," said Joshua Raymond, market strategist at City Index. "This means that the case for the start of a new bull market cannot be ignored. However, we must remain cautious as there are still potential obstacles down the line, such as Thursday's stress tests."
In other European stock market trade Tuesday, Frankfurt's DAX 30 was down 1% at 4853 points and in Paris the CAC 40 fell by 0.4% to 3,225 points, giving up their Monday gains.
Wall St.
US stocks fell on Tuesday as the recent sharp run-up tempted investors to take profits while government stress test results due later this week may show about half of the banks under review need to raise more capital.
The Nasdaq fared worse than the other indexes, down more than 1 percent. Among the top drags were shares of Qualcomm (QCOM.O) and Microsoft (MSFT.O).
The Dow Jones industrial average was off 27.64 points, or 0.33 percent, to 8,399.10 in midday New York trading. The Standard & Poor's 500 Index slipped 6.90 points, or 0.76 percent, to 900.34. The Nasdaq Composite Index .IXIC gave up 20.23 points, or 1.15 percent, at 1,743.33.
