Czech equities, as measured by the PX Index, were off by 1.9% for the week to close at 1,643.2. The overall volume of trading on the PSE reached USD 967.7m, 15.8% above its 12M weekly average of USD 835.5m.
The most actively traded stock of the past week was CEZ, followed by Zentiva. CEZ lost 0.3% while Zentiva gained almost 1%. Zentiva appeared to be continuing to benefit from its announced acquisition of the Turkish generic drug producer and a number of analyst upgrades. The best performer last week was the developer ECM, which gained almost 7%. A domestic broker initiated its coverage of the stock with a Buy recommendation and a fair value of CZK 2,300 per share.
This new listing significantly outperformed its regional peers and it appears as though a number of investors are switching their real estate allocation into ECM. The stock will be included together with Pegas Nonwovens in the main PSE benchmark, the PX Index, as of Monday, March 19. Erste Bank declined due to selling coming out of Vienna. The rest of the downward pressure on the market was largely due to the activity of the international accounts.
The market is waiting for the government’s decision, which should be made on Monday (March 19), concerning its sale of a significant state stake in the energy producer CEZ. The most probable scenario is the sale of 7% of the company through a stock exchange offering.