ZSE: Investors Await the Buyout Price of Konzum

After yesterday’s strong growth, the Zagreb Stock Exchange is expected to stabilize the Crobex today, with the stock of Konzum potentially back in focus for investors, following Agrokor’s announcement of a takeover bid for the retail chain.

Of the 7 analysts from brokerage firms who participated in the Hina survey, 6 expect stagnation of the Crobex today, while 1 expects an increase. The Crobex index rose by 1.32 percent yesterday, to 1,763 points, while Crobex10 increased by 1.63 percent, to 987 points. Regular trading in shares reached 11.9 million kuna, nearly double the previous trading day.

– I expect the continuation of the positive trend in the domestic capital market today, which is mainly a result of developments on foreign exchanges, as there are no significant domestic business news anyway – Tamas Nagy, broker at Erste&Steiermaerkische Bank.

Million kuna turnover was achieved yesterday with shares of AD Plastik, whose price strengthened by 1.64 percent, and Ericsson Nikola Tesla, which increased by 2.17 percent.

– The news of the day yesterday was Agrokor’s announcement of the intention to acquire shares of Konzum. We will see what the acquisition price will be and how it is intended to be carried out – says Nagy.

Trading in Konzum shares was suspended yesterday until 1 PM, after the Agrokor group reported the acquisition of Konzum shares and the obligation to publish a takeover bid.

Agrokor now holds a total of 17.4 million ordinary shares, or 76.93 percent of the equity of this retail chain. In accordance with the law, Agrokor will submit a request to the Croatian Financial Services Supervisory Agency for approval of the takeover bid for Konzum.

A total of 678 thousand kuna was traded in Konzum shares yesterday, and their price fell by 1.38 percent, to 142 kuna. The start of the year on foreign exchanges is exceptionally good, primarily due to the resolution of the ‘fiscal cliff’ issue, adds Nagy.

On Wall Street, stock prices recorded the largest daily jump in over a year on Wednesday as investors breathed a sigh of relief after a last-minute agreement in Washington avoided the ‘fiscal cliff’ that could have pushed the U.S. economy into recession.

The Dow Jones index rose by 2.35 percent, while the S&P 500 jumped by 2.54 percent, and the Nasdaq index by 3.07 percent.

“The news that kept investors in uncertainty for a long time had a somewhat cinematic ending to the satisfaction of investors. They were also encouraged by the rise in the ISM index of industrial activity in the U.S., from 49.5 to 50.7 points in December,” says Nagy. In Asian markets, stock prices rose this morning, thanks to investors’ hopes for a stable recovery of the Chinese economy, but the euphoria from yesterday has subsided.

Although the picture in the markets is good for now, investors will continue to monitor how the issue of further U.S. borrowing will be resolved, notes Nagy.

– New guidelines for investors will be provided by today’s announcement of data on the German labor market, as well as the minutes from the last Fed meeting, and tomorrow’s key employment report in the U.S. – concludes Nagy.