Banks remain under pressure

Greek stocks on Friday recouped much of Thursday’s massive losses on news of the US Federal Reserve’s lowering of its discount rate by 50 basis points, and the Athens Exchange (ATHEX) general index closed with gains of 0.93 percent for the week, at 4,678.23 points. The FTSE/ATHEX 20 blue chip index was up 0.54 percent, the FTSE/ATHEX Mid-40 gained 1.56 percent and the FTSE/ATHEX 80 small-cap index was 1.77 percent higher. The FTSE/ATHEX International added 0.69 percent. Sectoral indices were led by media, which surged 9.45 percent. Utilities followed with gains of 7.61 percent, while technology climbed 6.36 percent. Banks was one of only two sectoral indices that headed south, dropping 0.76 percent. This was a reflection of the fact that banking blue chips are sustaining the greatest pressures, as in foreign markets, where the crisis in the US subprime mortgage market remains the strongest source of anxiety for credit institutions. Additionally, in the Greek market, banks Eurobank and Piraeus are in the midst of rights issues, of more than -1 billion each, tying down liquidity that might have otherwise been channeled into the market by short-term players. However, other blue chips, such as OTE telecom, gaming firm OPAP and Coca-Cola HBC, have shown strong resistance to pressures. HSBC retained its price target of -30.50 for OPAP, which is due to announce first-half results on Thursday. In contrast, Goldman Sachs lowered its price target for Hellenic Petroleum to -10.50, from -11 previously, due to slightly lower-than-expected second-quarter results. Turnover totaled -2.24 billion, representing a daily average of -560.74 million in the four-session week, against -438.11 million in the week before.