The bulls that have driven the Athens Stock Exchange (ASE) upward since April Fool’s day are stocks directly or indirectly controlled by the State. The situation reminds investors of the frenzied rally during the summer of 1999 – when the ASE index reached its historic closing high of 6,355.04 – or the mini-rally staged just ahead of the last national election, on April 9, 2000. It is the first time since 1999 that the market has taken a consistently upward turn for more than a couple of months. On March 31, it reached its lowest point since fall 1998, with a close at 1,467.30 points. Since then, the general index has risen 30.21 percent to close yesterday at 1,910.60 points. Some stocks have risen spectacularly. Ethniki Real Estate, one of the protagonists of the 1999 bubble, has risen 72 percent. Other utilities, such as electricity utility PPC, state lottery and soccer pools firm OPAP and the Thessaloniki Port Authority have seen their turnover increase significantly. In April, total turnover on ASE was 1.9 billion euros. In May, turnover rose to 2.27 billion, a 15.37 percent rise, of which only 157 million was due to pre-arranged transfers of share blocks. The rise, which accelerated toward the end of May, is likely to be much higher in June. Banks were the most active market players, but social security funds and public corporations were also quite active. Their activity has even brought back to the market some retail investors, who had deserted the market in droves at the time of its protracted fall. A proof that more players are entering the market is the number of new accounts created in the Central Depository. In January 2003, only 1,653 accounts opened. A mini-rally in February led to 36,441 new accounts being opened. A dismal March led to only 2,503 accounts being opened, and the number dropped even more, to 2,390, in 2002. In May, when the rise had shown itself to be durable, 16,728 new accounts opened. More importantly, while in the first quarter only 4,000 accounts were active in each session, on average, the number has doubled now, and in some recent sessions has reached almost 12,000 accounts. During this period, there have been only two big business deals – the acquisition of tobacco industry Papastratos by Phillip Morris and the merger between Hellenic Petroleum and Petrola Hellas – too few to explain this sudden buying frenzy by domestic and foreign institutional investors. Market analysts explain that it is the opportunity for even short-term gains after a drought which lasted most of the previous 42 months that has fueled the institutionals’ appetite. In any case, they say, the Athens market has long been undervalued. The improvement in the climate at international bourses has also played a role in bringing in fresh investment. Retail investors are far from being the driving force they were in the summer of 1999; their interest, however, has picked up, including in so-called «peripheral» stocks that had also led the 1999 rise but which later came crashing down almost as fast as they had risen. There is another process underway that fuels interest in the market: consolidation. In several sectors, it is obvious that only the biggest fish will prevail. This realignment will be painful for many smaller companies but it is inevitable, especially as the 2004 Athens Olympics approach. With several state selloffs ahead, the rally is set to continue for the time being.