Continuation of Positive Atmosphere Expected at ZSE

At the Zagreb Stock Exchange, most analysts today expect a continuation of the positive atmosphere among investors, thanks to the good sentiment prevailing in global markets, as the belief that capital markets have already passed the worst crisis becomes more widespread.

Of the eight analysts from brokerage firms who participated in Hina’s survey, six expect an increase in the Crobex today, while two expect its stagnation. The Crobex index started this year positively, recording a 2.9 percent increase on Monday, reaching 1,772 points. The regular turnover of shares was 21.4 million kuna. “On the wings of optimism in global markets, I expect a positive atmosphere today at the Zagreb Stock Exchange,” says Goran Vorkapić, broker and investment advisor at the brokerage firm To-One. However, he adds that due to continued low trading volumes, it is evident that investor confidence has not yet returned in full force to the market.

On Wall Street, stock prices rose on Tuesday due to hopes that the proposal for a new stimulus package for the U.S. economy, which includes the largest infrastructure investments since the 1950s, will be quickly accepted. Stock prices also rose this morning on most Asian exchanges for the eighth consecutive day, a streak not seen since October 2007, as investors hope that government stimulus measures worldwide will boost economic recovery. On the Tokyo Stock Exchange, the Nikkei index jumped 1.7 percent this morning to 9,239 points, the highest level in two months. Today, the world’s largest aluminum producer, Alcoa, announced the layoff of 13,500 workers or 13 percent of its total workforce. In Croatia, layoffs in retail are also being announced.

“With the intensification of the crisis in the real economic sector globally and domestically, along with a wave of layoffs since the beginning of this year, we are still in a very uncertain period. Nevertheless, I expect stock prices on the exchange to stagnate, or even rise slightly. While the real economy will ‘struggle’ for some time, it is possible that the capital market has already hit bottom,” emphasizes Tomislav Kovalisko, head of brokerage operations and investment advisor at Volksbank. Investor focus is still expected to be on the most liquid stocks – shipping, construction, and telecommunications, according to Hina’s survey. Some analysts also point out that in the upcoming period, there could be increased interest in T-HT shares, depending on whether the company will pay an extraordinary dividend. However, analysts say it is unlikely that companies will be as generous in dividend payouts this year as they were last year, which will be remembered for its record dividend payouts.  (H)