CEZ gained after the reports that energy-sector restructuring will be finished, Erste lost because of HVB´s plans annoucement

The PX-50 index lost 0.3% and closed at 488.50 points on Thursday. Volume traded in the SPAD system reached USD 13.50 mil. CEZ gained 2.69% to CZK 95 after the reports that energy-sector restructuring would be modified were denied. We however believe that the stock’s strength was led by brokers’ short coverings rather than natural buying. Cesky Telecom closed below CZK 300 yesterday, but volume was low (including cross trades of 200,000 shares off-market). Erste Bank lost almost 3% after HVB announced plans to float 25% in Bank Austria in Vienna, whose stock may now face increased demand (Bank Austria has descent EMEA exposure, similar to Erste). We expect another uneventful session today; Cesky Telecom will likely continue to trade below CZK 300, CEZ should trade lower on domestic retail selling, and the events in Iraq will remain the focal point of most investors.

Milan Procházka