The Bucharest Stock Exchange lost more than 5% yesterday, the biggest decline of the last three months, after the BET index (which indicates the evolution of the 10 most liquid shares on the market) approached a 3-year low. None of the 25 most traded shares managed to close the session with less than a 1% loss. Such declines would have been unconceivable for investors a year ago, when the Stock Exchange grew by a few percentage points each day and approached historic highs. In the meantime, the crisis on the international markets and the doubts hanging over the global economy have turned overall optimism into pessimism. Unlike last summer, when the Bucharest market closed 22 out of 33 sessions on a high (between June 1st and July 15th), during the last month and a half the Stock Exchange has seen declines in 22 sessions out of 31. Yesterday's session was the most dramatic and affected companies in the financial sector, which saw the sharpest declines since early June, as well as manufacturers of chemical fertilizers, the only ones that saw gains in the above-mentioned period. The shares of Banca Transilvania (TLV) lost 8.1%, despite a 40% higher profit reported in the first quarter. SIFs (Financial Investment Companies) also saw declines of around 5-6%, while BRD lost 3.7%. "It is natural that banks should be among the most affected, given the problems experienced by the financial sector globally. SIFs are traded at a 100% discount, but they do sell. An explanation is the lack of foreign investors, which means the market is currently dominated by Romanians, who have started to panic, as there is no more support on the buying side. Money is no longer coming in from abroad," explains Liviu Giugiumica, head of UniCredit CA IB Securities.
