The PX-50 index lost 2.45% to 414.80 yesterday as stop-losses led Cesky Telecom lower by more than 5.4%. Against our expectations, equity trading was busy, thanks to domestic retail brokers who initiated a large sell-off in Cesky Telecom. The weakness in that title sent others south as well. Cesky Telecom closed down 5.46%, at CZK 346. Even Komercni banka lost its recent strength, and the overall negative trend seemed confirmed when Komercni’s CZK 1,000 support level was broken. Indeed, the stock has further downward potential. Total market volume reached USD 17.23 mil. on Tuesday. For today, the market is likely to open weaker after last night’s US markets’ decline; however, we expect a slight rebound later in the day, since, from a technical point of view, the index is presently oversold.
(Milan Procházka)