The market closed slightly up on the back of an improved mood on the emerging markets. The overall volume was again below the YTD daily averages. Philip Morris continues to fall. It has lost 19% of its value in the last three days due to its poor 1H06 results and is now at its lowest level since 2002. Foreign accounts were on the sell side while domestic players were buying. Zentiva strengthened, benefiting from a Citigroup upgrade. CEZ traded in the narrow range of CZK 808 level on a mixed flow. Telefónica O2 CR moved up in line with its regional peers. CZK 475 seemed to be a resistance level. CME gained after the announcement that Apex was entering into the company.
For today, we expect to see a mixed opening, with an ongoing buying appetite for the most liquid names, but volumes will remain low as most of the accounts are taking the last couple of days of summer as a holiday. CEZ will remain sensitive to the outcome of the 2007 electricity auction; CME is expected to open higher on the US arbitrage gap; and, Philip Morris should trade close to the CZK 9,000 level.