The Athens Stock Exchange finished Monday down 16.23%, a historic fall according to exchange operator, for its reopening after five weeks of closure linked to the introduction of capital controls in Greece.
The ATHEX index closed at 668.06 points recovering slightly over the day of its opening with a dive of 22.82%. According to the Greek bourse operator, the last drop of this magnitude was in December 1987 with losses of 15.3% on a session.
Bank stocks amputated third of their value
Bank stocks were particularly penalized with a dip of about 30%, which reflects the great vulnerability of the sector pending urgent recapitalization after withdrawals of over € 40 billion since December.
Market participants predicted remission in tough road after an interruption of trading since June 26 amid deadlock in negotiations between Greece and its creditors, EU and IMF to resume support of the country.
On the night of June 26 to 27, Greek Prime Minister radical leftist Alexis Tsipras had made the surprise announcement of a referendum on the new austerity measures proposed to his country.
Exchanges limited for local
Faced with the risk of prolonged banking panic and a bank collapse, the government had decreed June 29 capital controls and closing both banks, which finally reopened on July 20, and the stock exchange.
The exchanges resumed Monday with limitations for local investors. They can not finance the purchase of securities with the money from their bank accounts in Greece, thus being subject to capital controls still in force in that country. They may, however, use offshore accounts or make cash transactions. A ban on short selling to limit speculation downward was also in force on Monday.
Foreign investors -who hold about 60% of the market capitalization on the grec- market are not affected by these restrictions.
(With AFP)
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