ECONOMY

Further losses in local bourse

Losses for Greek stocks increased during February, with the decline of the general index from the start of the year reaching 20 percent, while capitalization has dropped to 165 billion euros, meaning that the bourse has shed over 38 billion euros. The last week of February was particularly painful for the local bourse (ATHEX), whose main index shrank by 4.99 percent over the last seven days, dropping from 4,350.03 points to 4,133.03 points last Friday. Banking stocks took a huge beating from foreign portfolios despite the very satisfactory 2007 results by Alpha Bank and the swing to profits by Emporiki Bank after two years. Greek banks are now targets for obtaining cash flow for international funds, even though they have not been involved in the subprime mortgage crisis. During the week Economy and Finance Minister Giorgos Alogoskoufis announced the government’s intention to abolish the 0.15 percent sales tax on stock transactions and replace it with a capital gains tax. The sector is worried about the gradual rise of transactions outside the stock market. According to the head of the Athens Stock Exchange, Spyros Kapralos, these transactions take place outside the market due to the MiFID directive, resulting in the drop in the Athens market’s turnover. This drop is observed across all stock markets because after crises like the one seen in January and February are normally followed by a decline in volume. At least, added Kapralos, the abolition of the tax will help the local market, as the levy made it less competitive.