THE CYPRUS stock market came to a quiet close yesterday after a record-breaking year that has earned it a place among the highest performing bourses worldwide.
Turning in an extraordinary return of 688 per cent by yesterday, 1999 saw the Cyprus Stock Exchange emerge from a backwater to a bourse whose showing has outperformed every market in Europe and the Middle East.
By yesterday, the Istanbul stock exchange was trailing a distant second with a 506 percent returnthis year.
Market capitalisation now exceeds £10 billion pounds, compared to a cap of little over one billion last January.
Yesterday’s close saw the market lower by 1.46 per cent to 713.97 points.
Profit taking mainly by institutional investors preparing year-end results defied analysts’ expectations of a rise following Wednesday’s 5.25 per cent jump.”Some investors were disappointed at this and this showed half-way through the session when they started selling. Overall, though, it was a positive session,” one trader said.The market is expected to perform well next year, though it is unlikely to match the extraordinary feats of 1999, traders said.”I do expect the market to do well. I am quite confident of that,” said Yiannos Andronikou of Suphire Stockbrokers.The anticipated listing of the Bank of Cyprus in Athens, a major force behind this year’s rally, and new listings and announcements expected on share capital of the Cyprus Popular Bank, which celebrates its centenary in 2000, will ensure the market does not run out of steam, said traders.Looking back at a year that saw investors ranging from middle level managers to housewives pumped their deposit accounts dry in the scramble to invest, traders said market players were expected to be more selective when it came to decisions on where to put their money.”A more fundamental approach is appearing. Investors will no longer be buying shares under five pounds just because they are the cheapest ones on the market,” said Stavros Agrotis of CISCO.Different forces will come into play next year. A wave of mergers and acquisitions in corporate Europe will filter down to Cyprus sooner or later, said stockbroker Costas Hadjigavriel.He said companies would be looking for opportunities to make use of their surge in prices andnewly-found wealth, possibly through acquisitions, and corporate spin-offs were also expected.”There are big capitalisation stocks and the small ones. The small ones either have to get bigger or they will be swallowed up… I think this adjustment will happen at a very rapid pace because the money is here,” he said.
