The PX-50 index dropped a further 0.47% to 786 points on Tuesday as the market continued to drift lower on a thin volume. CEZ continued to be well offered by both domestic as well as international sellers but the stock seems to have no problems sticking to levels around CZK 190. Even though we do not favor CEZ from the fundamental point of view, the trading perspective of the stock looks quite positive in the near term. Komercni banka is set to find a new level other than CZK 2,900 and we bet the next trend is down. Cesky Telecom lacks a catalyst for any major move but we think consolidation around CZK 320 is set to occur. We expect locals to step into Philip Morris CR as the date of the AGM announcement with dividend details nears.
Unipetrol continues to be sold by a local bank, though we do not share the view of many of the market participants that selling would be on the back of privatization speculations. We simply believe the local bank is selling its equity exposure in exchange for taking on a credit risk, as Unipetrol said yesterday it is seeking to borrow EUR 100m to refinance its maturing bond issue. Volume in the SPAD reached USD 25.50m.
Milan Procházka, Patria Finance