Athens Stock Exchange plummets 16 percent – The Economist

With a decline of up to 668.06 points, banks have reached the daily limit losses by 30 percent.

The Exchange Athens has in check to Greek investors.

In its first day of reopening, restrictions on domestic investors have not prevented a veritable collapse of Greek equities. The Athens Stock Exchange had been closed since 29 June (suspension longest since the 70s) when the fiasco in the negotiations on Greece and the call for a referendum by the government in Athens fired alerts in markets .

More than a month after the reopening, as feared, it has included a dramatic exodus of investors. The result is a fall that has surpassed 23% at times, an unprecedented event in the history of the Athens Stock Exchange, according to Reuters.

The debacle has been led by banks . Entities and National Bank of Greece and Piraeus Bank, have reached the daily limit of 30% of losses. Over the meeting, the rout of Greek equities has moderated, and falls are down to 16.23 percent.

According to the provisions, foreigners have been able to issue purchase orders and selling without limit. By contrast, only nationals have been entitled to buy shares with money transferred from overseas bank accounts or cash reserves, but have not been able to use their bank deposits.

The hopes of an agreement they activated the comeback of the Athens Stock Exchange last June before its suspension. The rebound of 17% on makeup just crash the top 80% accumulated since the beginning of the crisis in 2007.

The stampede occurred in the midst of economic uncertainty generated by the new rescue plan agreed Greece, including measures setting tougher even than shuffled at the time of closing of the Athens Stock Exchange at the end of last June.

The settings set in the rescue also threaten with increasing internal dissension in Syriza, the party of the Greek prime minister, an additional factor increasing political uncertainty and possible call for early elections.

First tranche of bailout in Greece

According to published this weekend the Greek press, the government in Athens could ask 24,000 million in a first tranche of bailout of international creditors in August.

The first tranche of 24,360 million euros would be used to channel 10,000 million as an initial recapitalization of Greek banks; 716. 00 million to pay for emergency bridge loan, and 3,200 million for Greek bonds held by the ECB and other payments.

But the figure of 10,000 million euros to recapitalize banks may be insufficient and after the recent exodus of investors, Greek banks could borrow up to 25,000 million euros to clean up their balance sheets.

fondos@eleconomista.com.mx