Market Comment - In the Spotlight (Manos Chatzidakis)

Market Comment Stocks recovered on Monday some of the ground lost last week, as the benchmark index closed on the day’s high to add more than 2 percent, on a remarkably low transaction volume. General Index rose 2.03 pct to end at 1,178.38 points, but turnover shrank to a low 59.05 million euros. Banks once again led the way on relief that the Portuguese crisis of last week provide not to be contagious, with the bank index adding 3.09 percent. We expect domestic market to expand upward trend in the beginning of the session while trading volumes remain a key issue for maintaining the positive momentum.           In the Spotlight Greece/Primary Budget Surplus: Greece’s H1 2014 primary budget surplus reached €712m against a primary deficit of €1.51bn a year ago, beating a primary surplus budget target of €635m. Furthermore, according to provisional budget execution data (on amended cash basis), Greece recorded H1 2014 state budget deficit of €2.41bn from a deficit of €4.99bn over the same period last year, coming better off vs revised budget target for €3.86bn deficit. In turn, net state budget revenues exceeded €23.6bn in H1 2014, 1.1% above revised budget target, with regular budget net revenues reaching EUR20.65bn, 0.3% higher vs revised targets. Greece/PDMA: The Public Debt Management Agency (PDMA) will auction today €1.25bn three-month treasury bills. The yield in the previous auction stood at 1.8%. Banking Sector: According to internet articles Greece may follow the Portuguese way of handling the deferred tax asset in the banking sector. Following the conversion of DTA to a tax credit the banks will save extra capital for their regulatory needs reducing the potential of new capital increases ahead of the EBA/ECB stress test. Hellenic Exchanges: Helex announced that will proceed with a special dividend (share capital return) of €0.20 per share. Ex-date is July 16th and payment date is July 24th. Elliniki Technodomiki Anemos: Ellaktor’s RES subsidiary successfully raised €35.1m from the market for its IPO. Τhe company issued 20,667,000 new shares priced at the lower end of the range (€1.70) which leads to a post IPO market cap of €140.53mn. The positive impact on Ellactor’s balance sheet will be on group’s equity by €30.78mn. The proceeds from the IPO will finance part of a 118 million euro investment plan for new wind parks, which will enhance its capacity by about 94 megawatts by 2015. New shares will trade on July 22. Lamda Development: The company announced the successful completion of a share capital increase plan worth 179,661,359 euros. The capital increase was 1.1977 times oversubscribed while 940 shareholders participated, covering 148,914,823 euros or 99.28% of the initial sum of 150 million euros. Another 154 shareholders also participated paying 30,746,535 euros for 7,234,479 new shares Water Utilities: The government will delay the privatizations of Athens Water and Thessaloniki Water according to the Vice President of the Government Venizelos. Piraeus Bank: The bank announced that it will release 1H/2Q:14 earnings results on August 28.