ZSE: Has the Growth Period Ended?

Under the influence of profit-taking sales, the Crobex indices on the Zagreb Stock Exchange fell by about 1 percent today, marking the second consecutive day of decline, but with significantly lower turnover than yesterday.

Around 12:00 PM, the Crobex was down 0.99 percent, at 1,939 points, while Crobex10 was down 1.23 percent, at 1,077 points. The regular turnover amounted to 3.54 million kuna, which is 5 million less than yesterday at the same time.

– Since December 17 of last year, when the country’s credit rating was downgraded, the Crobex has been rising without major downward corrections. However, in the last two days, it has already dropped 43 points from its peak, so we can say that the period of its growth with low price volatility has ended. With the increase in volatility, corrections usually follow – says Siniša Gašparević, investment advisor in the Treasury and Investment Banking Sector of the Splitsko-Dalmatinska Bank. From a technical perspective, the Crobex reached 1,983 points, where it encountered resistance and slid downwards.

– When a line is drawn on the Crobex chart from its peak in 2011 to its bottom in 2012, the halfway point is at 1,983 points. After touching that resistance on Tuesday, the Crobex slid downwards. Its first support level could be around 1,900 points – believes Gašparević. The most liquid stock is Valamar Adriatic, with a turnover of 1.03 million kuna. Its price has fallen by 3.43 percent, to 152.06 kuna.

Next is the HT stock, with nearly 840,000 kuna in turnover. Its price has decreased by 1.56 percent, to 211.05 kuna. Most stock prices today are recording declines. The largest loss was suffered by the Dalekovod stock, with a price drop of 6.84 percent, followed by Maistre at 5.2 percent, and the Termes group at 4.88 percent.

On European exchanges, the major indices are moving differently today, primarily influenced by various corporate earnings reports.

Thus, the London FTSE is currently down 0.23 percent, while the Paris CAC is down 0.16 percent, and the Frankfurt DAX is up 0.11 percent.

– A positive trend continues on foreign exchanges, but investors are becoming increasingly cautious, expecting a decline in the major stock indices after they reached multi-year highs. In some markets, corrections have already begun. For example, the Turkish stock index, which had the highest growth in the world last year, is down 0.7 percent since the beginning of the year, and just 20 days ago it was up 10 percent – notes Gašparević.