Greek stock market reopens to huge losses after five-week shutdown, hopes to recover with upcoming bailout
The first two days of Greek market activity saw nothing but bloody reds as the Athens Stock Exchange witness massive selloffs from foreign investors unrestricted by current capital controls that limit withdrawals from local banks to a measly €60.
CNBC noted that the benchmark Athens Composite Index closed 16.2 percent on Monday, falling as much as 23 percent during the trading session, and closed with another 1.2 percent loss on Tuesday. The banking sector is especially hit hard, with Piraeus Bank SA and National Bank of Greece SA reaching their 30 percent daily volatility limit on both days and the Eurobank and Alpha Bank not falling far behind.
Traders in Athens remain anxious as prices continue to plummet. Speaking with Stavros Kallinos, the head asset manager of Guardian Trust, Bloomberg reveals that traders anticipate several more days of the market crash and stocks hitting their lows before the market begins functioning properly again.
A ray of sunshine is seen, however, as the Tuesday result is better than expected.
The banks remain at depressing lows, but the non-financials are attracting investors. Nineteen of the exchange's 25 blue-chip stocks took a raise, giving FTATRET over 11 percent boost.
"The second day of trading showed clear signs we are moving towards a normalization of the market after the long shutdown," Socrates Lazaridis, chief executive officer of Hellenic Exchanges, shared with Reuters.
For the future, the Greek market is seeing hope with the ongoing discussion for an €86 billion bailout with its creditors. The country's €3.5 billion debt from the European Central Bank (ECB) will be maturing on August 20, and Greece is optimistic that an advantageous agreement will be reached before the said date.
Having met the representatives of the ECB, the International Monetary Fund, the European Commission, and the euro zone's rescue fund, the European Stability Mechanism, Finance Minister Euclid Tsakalotos ended the brief meeting with reporters with a reassuring statement: "Everything will be concluded this week."