ECONOMY

Stocks hit by global drop

The globally negative climate in stock markets took its toll on the Athens Exchange (ATHEX), as the general index posted a weekly decline of 3.12 percent on Friday closing at 4,901.27 points, down from 5,058.86 points the previous week. Blue chips saw extensive sale orders, dragging mid- and small-caps lower too. The mortgage credit crisis in the US had created a domino effect across world markets. Yet late on Friday afternoon a pleasant surprise came from the US with the acceleration of US economy growth rates in the year’s second quarter. This news brought some measure of calm to European markets, which immediately made up most of the lost ground. It would be risky to predict whether this decline in Greek stocks will continue, given that it arose from extraneous factors. At this stage, expectations for upcoming domestic business deals appear to be moving out of the spotlight, as do the first-half results by listed companies. The risk of a greater decline is mainly due to the familiar attitudes of Greek investors who are easily swayed by foreign trends. Consequently, interest is now shifting to mid- and small-caps which are less affected by orders from abroad. Among sectoral indices, mass media posted a significant 10.51 percent decline, followed by financial services (down 7.71 percent), health (7.46 percent), raw materials (6.49 percent), industrial products and services (5.90 percent), construction (5.40 percent) and commerce (5.19 percent). Turnover saw its average level decline by almost one quarter last week, due to an absence of major business deals conducted via the stock market and the start of many investors’ holidays.