By Hamza Hendawi
TRADE on the Cyprus Stock Exchange resumed yesterday after the weekend break with seven brokerages banished from the floor for failing to meet a Friday deadline on processing outstanding transactions.
The absence of nearly a third of the brokerages accredited to the exchange depressed volume — £13.20 million — but did not stop shares from recording a new all-time high. The all-share index closed at 504.96, 2.94 per cent up on Friday’s close. All seven sectors of the market made gains yesterday with the “other companies” sector making the most (14.77 per cent), followed by trading companies (10.31 per cent).
The Bank of Cyprus, the bourse’s locomotive, ended slightly lower at £10.95, while the Popular Bank finished higher at £11.82. BoC’s 1999-2003 warrants notched up 21 cents to close at £8.95, while Popular Bank’s 1993-99 warrants closed slightly higher at £19.95.
Among other leading shares, Louis Cruise Lines soared by 62.50 cents to close at £3.39, a level not reached since the early days of the title in August.
The decision to suspend seven brokerages was made on Friday night. One of the seven, AAA United of Neofytos Neofytou, had its licence suspended pending an investigation.
Neofytou, whose AAA United is part of investment house Share Link Securities, told the Cyprus Mail that he had learned of the exchange’s punitive measures from a television report late on Friday. He said the exchange was accusing his firm of short selling. “It is the result of an administrative error,” he said.
The other six brokerages are: Pro-Choice, Severis and Athienitis, Benchmark, Parma, Ethniki and Citi Principal.
Neofytou and representatives of the six other brokerages met with exchange manager Nondos Metaxas after yesterday’s trading session and said they were hopeful to return to the floor today.
“But there will probably be other brokerages suspended for outstanding transactions made on the following day (October 5),” said Neofytou.
The exchange’s get-tough policy on brokerages failing to process transactions within set time limits follows the bourse’s closures on three occasions since July. The shutdowns, the latest of which lasted for a month and ended on October 4, were dictated by a backlog of transactions which, according to brokers, could have caused the market to collapse if not cleared.
