By Hamza Hendawi
IN WHAT HAS of late entered the realm of the expected, share prices soared yesterday to their seventh successive record close while volume registered an all-time high of £24.56 million.
The official all-share index of the Cyprus Stock Exchange closed at 153.61, up 2.85 per cent on Friday’s close and 19.16 per cent since the string of seven record-breaking sessions began on Friday May 14. Gains on the year now stand around 70 per cent.
Yesterday’s appreciation appeared to make nonsense of widespread expectations that a correction movement would set in at the start of this week to arrest, albeit briefly, the market’s meteoric rise.
“My view is that so long as the funds keep pouring in the market will continue to go up,” said Panicos Kaiserlides of Benchmark Securities. “If there is to be a correction, it will be an inter-day one.”
Other traders said the consistently higher-than-usual volume appears to lend credibility to unconfirmed reports that funds from institutional investors in Greece are finding their way to the market.
“It is either that or Cypriots are coming in with more money than we thought, including those who are borrowing to do so,” said one trader.
As usual, yesterday’s rally was largely on the back of bank titles, which attracted £15.30 million of the day’s trade.
Keen interest in the titles of the Bank of Cyprus and the Popular Bank has been maintained at exceptionally high levels from January.
A centenary package to shareholders that included bonus shares and warrants and a rights issue was announced by the Bank of Cyprus in January, starting off a rally in the stock that spilled over into other banking titles.
Soon afterwards, the Popular Bank announced a 1=2 share split and a new rights issue which took the stock to high after high in the past four months.
A large part of the interest also stems from the two banks’ declared aim of obtaining a listing on the robust Athens Stock Exchange, where shares tend to be slightly overvalued, traders said.
Interest in the Bank of Cyprus, which closed yesterday at £7.06 apiece, up by 26.5 cents, is also being stoked by persistent rumours that the bank was pondering a share split to match that of its smaller rival the Popular Bank.
“It is still just a rumour, but it makes sense for BoC to do it,” said Kaiserlides of Benchmark.
Trade in the Bank of Cyprus shares and 1999-2003 warrants accounted for 58.1 per cent of yesterday’s trade. A total of 1.58 million shares and 618, 000 warrants changed hands. The warrants, which made their debut in the market last Thursday and have an exercise price of £3.0, finished lower at £4.89. The Hellenic Bank, which holds its annual general meeting today, leapt by 48.50 cents yesterday, the highest one-day rise in memory, to close at £4.32.
