Volatility cuts initial gains

The three first winning sessions on the Athens Exchange (ATHEX) last week were followed by a wave of liquidations on Thursday and Friday, when the general index closed 0.70 percent lower than a week earlier, at 5,097.51 points. The ATHEX showed a capacity of disregarding negative news from abroad early in the week but developments later got the better of it. The move by the five largest foreign central banks to channel liquidity of $64 billion into the economies of Europe, the USA and Canada did not appear sufficient to counter the continuing effects of the subprime loan crisis. Buying interest was initially focused on blue chips but only small-caps managed to close the week higher, with the FTSE/ATHEX Small-Cap 80 index closing with gains of 1.39 percent. Petroleum and insurance led sectoral indices, ending 7.43 percent and 5.26 percent higher for the week. The question that seems to be uppermost in traders’ minds is whether the so-called «January effect» will reappear next month, since for the first time in 10 years conditions are completely different and the ultimate toll of the effects of the subprime loan crisis on global markets is expected to become clear in the first two months of the new year. Greek stockbrokers on the whole avoid forecasts on medium-term prospects. «Due to the crisis, any forecast would be unreliable,» said one trader. The most prominent business development of the week was shipowner Panos Laskaridis’s sale of his stake in Minoan Lines to Cyprus-registered Sea Star, whose basic shareholder is Yiannis Vardinoyiannis, the CEO of ANEK Lines.