The reason for the trend is the optimism about the successful completion of Electrica’s initial public offering, which raised a record high amount of cash from investors, EUR443 million.
Electrica put Romania on the map of heavyweight foreign investors, and its IPO was also conducted on the London Stock Exchange, drawing the attention of major investment funds to the local stock market.
The largest local listed company, OMV Petrom (SNP.RO) gained almost 10% in the past month and Transelectrica (TEL.RO) about 23%. Transelectrica stocks have increased by 42.5% since the beginning of the year.
“The increases of the last few days are not because of certain news but because of investor optimism and the rumors of some investment funds entering the Romanian stock market, which drove up the stocks of future-proof companies,” says Marcel Murgoci, chief operating officer of brokerage firm Estinvest.
“Us having raised a lot of cash in the Electrica IPO helped and most of the money left after that was directed to the rest of the market. This shows in the volumes and significant increases on the stock market on Monday.”
Monday was when the investors in Electrica IPO got back some of the money committed for the oversubscribed offering, and BET rose 2% in a single day, the highest daily gain since the beginning of the year.
The growth of the Bucharest Stock Exchange in June, when the 10 most traded stocks gained 4.3% on average, was the highest of all markets in the region.
Brokers say that even though most of the stocks that rose in the past month had announced good results in the first quarter, investors were slow to react to their record profits.
Other top performers in June include SIF Moldova (SIF2.RO), which gained 9.2% in June, but is still 7.5% below the level at the beginning of the year and SIF Banat-Crisana (SIF1.RO), up 6.4%.
“I think the optimism will continue over the coming days unless news with a negative impact on the market comes up. I expect the volumes to increase, as well. There’s an upward trend of the market and even though July-August are typically slow months because of the vacation season, the start is promising and we might see an unusual July,” Murgoci added.
(English version by Loredana Fratila-Cristescu)