With 'Grexit' Fears Overblown, Is It Time To 'Grenter' Greek Stocks?
Camellia Capital Management • 20 Comments
Camellia Capital Management • 20 Comments
Jul. 31, 2015, 8:25 PM
- After five weeks of closure, the Athens stock exchange will reopen on Monday, after what seems like a geological time frame's worth of developments in Greek solvency.
- After the government's compromise with creditors, investors say it will take some time, likely months, before the companies there can raise money internationally.
- “The Greek crisis has had an adverse impact on all sectors of the economy,” said Apostolos Gkoutzinis of law firm Shearman & Sterling.
- The Luxembourg stock exchange lifted a suspension on trading of Greek bonds a week ago.
- GREK +2.6% today, though still down 21.7% over the past three months. The National Bank of Greece (NYSE:NBG) gained 6% today (and is down 19.9% over the past month).
- Related tickers: OTC:ALBKY, OTC:BPIRY, OTC:EGFEY
- Previously: IMF drops bombshell on Greece (Jul. 31 2015)
- Previously: Greece, creditors begin talks to secure bailout deal (Jul. 28 2015)
Jul. 27, 2015, 12:11 PM
- Getting a chance to react to the rough Friday afternoon action in the U.S. as well as the 8.5% plunge in China overnight, Europe's Stoxx 50 (NYSEARCA:FEZ) closes Monday with a 2.35% loss. The broad gauge remains higher by 12% for the year.
- Germany (NYSEARCA:EWG) and France (NYSEARCA:EWQ) fell 2.5%, Italy (NYSEARCA:EWI) 3%, Spain (NYSEARCA:EWP) 1.4%, and the U.K. (NYSEARCA:EWU) 1.1%. The Athens Stock Exchange looks set to reopen tomorrow. GREK -3.5%
- ETFs: VGK, FEZ, HEDJ, IEV, EPV, EZU, FEU, EEA, EURL, FEP, UPV, DBEU, ADRU, HEZU, FEEU, IEUR, FIEU, DBEZ, FEUZ, SBEU, HFEZ, HGEU
Jul. 14, 2015, 10:50 AM
- "The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date - and what has been proposed by the ESM," says the IMF in a report sent to EU governments hours after they and Greece agreed in principal on a third bailout program.
- Among the measures needed would be a 30-year grace period on servicing all European debt (otherwise known as default), a very dramatic maturity extension, or explicit transfers to the Greek budget. Alternatively, the Troika could accept "deep upfront haircuts" on their loans to the country.
- This study sees Greek debt peaking at nearly 200% of GDP in the next couple of years versus a previously forecasted high of 177%. By 2022, the debt would stand at 170% of GDP versus an estimate of 142% just two weeks ago.
- The latest projections, says the IMF "remain subject to considerable downside risk."
- Source: Reuters
- The Athens Stock Exchange remains closed.
- GREK -5.9%, NBG -6.7%
Jul. 13, 2015, 11:17 AM
- The Athens Stock Exchange remains closed, but the Greek ETF (GREK -3.9%) and the ADRs of National Bank of Greece (NBG -2.9%) have reversed big early gains to turn solidly lower.
- The deal agreed to by Greek PM Tsipras this morning brings to mind the TV deal negotiated by George Castanza on Seinfeld in which he and Jerry ended up with less money than had originally been offered. Now Greek lawmakers have the pleasure of voting for a package more harsh than the one they and the electorate have just rejected.
- See Bloomberg: Tsipras Has Vandalized Greece
- Previously: More on EU-Greek agreement - Greece forced to sell €50B worth of assets (July 13)
Jul. 7, 2015, 10:42 AM
- Greek government officials arrived at today's meeting of European finance ministers without a new proposal, according to the FT, shocking the group and angering some in the room.
- One Eurogroup source says Greece instead will present its latest gambit tomorrow directly to the Troika. Another source says the Greek officials presented an outline of a plan to the Eurogroup, but written materials were still being worked on. A Greek official says his government presented the same plan from last week that's already been rejected.
- In any case, the eurocrats don't seem pleased. Europe has taken a new leg down, led by France's (NYSEARCA:EWQ) 1.5% decline. Germany (NYSEARCA:EWG) is off 1.4%, Italy (NYSEARCA:EWI) and Spain (NYSEARCA:EWP) 1.3%. The Stoxx 50 (FEZ -2.4%). Greece ETF (GREK -4.6%), National Bank of Greece (NBG -7.8%).
- The euro (NYSEARCA:FXE) is lower by 1% to $1.0942.
- Previously: Europe can't hold gains (July 7)
Jun. 30, 2015, 10:54 AM
- Up nearly 1% earlier, the Stoxx 50 (NYSEARCA:FEZ) has turned lower by 0.6% less than an hour before the close.
- The Stoxx 50 shed 4.25% yesterday, led by Italy's 5%+ decline.
- The Eurogroup has set 1ET as a time for a conference call, at which Greece's latest proposal will be discussed.
- Not too badly dinged yesterday, the U.K.'s (NYSEARCA:EWU) 1% loss is leading on the way down today. Germany (NYSEARCA:EWG) -0.6%, France (NYSEARCA:EWQ) -0.8%, Itay (NYSEARCA:EWI) -0.1%, Spain (NYSEARCA:EWP) -0.2%.
- Athens remains closed for business, but the Greek ETF (GREK +5.1%) and National Bank of Greece (NBG +9.4%) are up sharply.
- ETFs: VGK, FEZ, HEDJ, IEV, EPV, EZU, FEU, EEA, EURL, FEP, UPV, DBEU, ADRU, HEZU, FEEU, IEUR, FIEU, DBEZ, FEUZ, SBEU, HFEZ
Jun. 30, 2015, 8:07 AM
- The Global X Funds Greece ETF (NYSEARCA:GREK) is up 3.3% premarket after yesterday's 19.4% drubbing, and National Bank of Greece (NYSE:NBG) is up 10% after yesterday's 24% decline.
- The country today will not make its $1.7B payment due to the IMF, thus officially going into "arrears." Urging the electorate to vote "no" to austerity measures on Sunday, PM Tsipras says Europe has no intention of kicking Greece out of EMU - the cost to the EU and ECB will be too high.
Jun. 29, 2015, 8:01 AM
- GREK -17% premarket, National Bank of Greece (NYSE:NBG) -30%
- Previously: Europe sinks 4% as Greece imposes capital controls (June 29)
Jun. 28, 2015, 6:41 PM
- Following today's news on Greece, and with emergency aid to the country frozen, the euro has slipped 1.4%.
- Major stock futures are also off 1.5%; Dow futures are down 271 points, while S&P 500 futures are off 35. Nikkei futures are off 500 points. 30-year bonds +2.5%. Crude -1.5%. Nasdaq -1.6%.
- ETFs: FXE, EUO, GREK, ERO, DRR, EUFX, ULE, URR, DIA, DOG, DXD, UDOW, SDOW, DDM, UDPIX
Jun. 24, 2015, 7:36 AM
- "Either they don't want a deal or they are serving specific interests in Greece," says Greek PM Alex Tsipras in a tweet.
- Tsipras has reportedly told his government the country's creditors have rejected his latest pension reform proposals. He's scheduled to meet with the ECB's Mario Draghi, the IMF's Christine Lagarde, and the EC's Jean-Claude Juncker this morning, with a Eurogroup meeting scheduled for later today.
- GREK -3.5%, NBG -7.1% premarket
- Previously: Europe soars on potential Greek deal (June 22)
Jun. 22, 2015, 7:38 AM
- While no deal has been reached, the Greek government's latest proposal makes major concessions on cutting deficits in the country's pension system - a long-standing demand of Greece's creditors.
- According to the Greeks, the pension savings should amount to 0.4% of GDP this year and 1% starting in 2016 - pretty close to the target demanded by the IMF, ECB, and EU governments. Pencil pushers in Brussels will spend the next few days going through the numbers ahead of an emergency summit late this week.
- Peripheral bond yields are headed south, while Germany's 10-year Bund yield is up ten basis points to 0.86%.
- The Stoxx 50 (NYSEARCA:FEZ) +2.6%, with Germany (NYSEARCA:EWG) up 2.7%, France (NYSEARCA:EWQ) +2.6%, Spain (EWQ) +2.5%, Italy (NYSEARCA:EWI) +1.7%, the U.K. (NYSEARCA:EWU) +1%. Greece is higher by 5.7%.
- GREK +2.7%, NBG +7.6% premarket
- ETFs: VGK, FEZ, HEDJ, IEV, EPV, EZU, FEU, EEA, EURL, FEP, UPV, DBEU, ADRU, HEZU, FEEU, IEUR, FIEU, DBEZ, FEUZ, SBEU, HFEZ, EU, BUNL, BUNT, GGOV
Jun. 19, 2015, 9:48 AM
- The ECB today boosted the amount Greek banks can borrow under the emergency liquidity assistance funding program (ELA) by about €1B, but that's just one-third of what depositors pulled from the lenders this week.
- Up well over 1% earlier in the session, European stocks (NYSEARCA:FEZ) have cut those gains significantly and Germany (NYSEARCA:EWG) has moved into the red.
- Athens is higher by 2.3%, but from very beaten-up levels. GREK +2.7%, NBG +0.9%
- Also higher earlier in the session, the 10-year U.S. Treasury yield is now off six basis points to 2.29%. TLT +0.9%, TBT -1.8%
Jun. 15, 2015, 7:00 AM
- Weekend talks aimed at resolving the Greek mess reportedly lasted just shy of an hour before ending.
- The Athens Stock Exchange General Index is lower by 4.4, with the yield on the country's 10-year paper up 69 basis points to 12.19%. The yield on the two-year note is up 308 basis points to 27.93%. National Bank of Greece (NYSE:NBG) is off 14.5% premarket.
- ETF: GREK
Jun. 12, 2015, 9:57 AM
- The bond rout of the past few weeks has been notable for its correlation. The bond markets of putative solid credits like Germany and the U.S. were hit as hard or even harder than those of countries like Spain and Italy.
- Potentially worrisome in today's action: Yields are flat to lower in Germany and the U.S. while moving sharply higher in the peripheral countries.
- The 10-year U.S. Treasury yield is down 1 bp to 2.37% and the 10-year German Bund yield is lower by 3 bps to 0.86%. Meanwhile, the Spanish 10-year yield is up 18 bps to 2.31%, and Italy up 12 bps to 2.26%.
- This is happening as another Greek default and then possible EU exit got more likely with the IMF technical team's return to D.C. yesterday, and investors may not want to be holding the paper of the next countries in line should anything adverse happen over the weekend.
- Spain's IBEX 35 (NYSEARCA:EWP) is lower by 1.3%, and Italy's FTSE MIB (NYSEARCA:EWI) by 1.5%. Elsewhere in Europe, Germany (NYSEARCA:EWG) is down 1.5% and France (NYSEARCA:EWQ) is down 1.7%. FEZ -2.2%, GREK -4.1%, NBG -7%
- ETFs: VGK, FEZ, HEDJ, IEV, EU, EPV, EZU, FEU, EEA, EURL, FEP, UPV, DBEU, BUNL, ADRU, HEZU, FEEU, IEUR, BUNT, GGOV, FIEU, DBEZ, FEUZ, SBEU
Jun. 11, 2015, 10:44 AM
- "We are well away from an agreement," says IMF spokesman Gerry Rice, as the agency's technical team returns to D.C. from Brussels. "There are major differences between us in most key areas and there has been no progress in narrowing these differences."
- The main obstacles, says Rice, are pension reform, tax policy, and financing. "On financing, what we have said consistently is that is has to add up."
- Nicely higher earlier, the Greek ETF (GREK -0.1) turns red, as does National Bank of Greece (NBG -0.8%).
- Previously: S&P further downgrades Greece (June 10)
Jun. 4, 2015, 4:42 PM
- The news hit after Athens stock exchange had closed for the session, but GREK closed down 5.9% in a preview of what may be ahead on Friday.
- It's the first time a developed country has ever missed a payment to the IMF, writes Ambrose Evans-Pritchard, noting the Greek government is invoking an obscure mechanism to bundle all debts due in June and pay them at the end of the month.
- A caught-off guard IMF (hours earlier, Christine Lagarde was confident the payment would be made on Friday) confirms it's been notified by the Greek government that the entire $1.6B due this month will be paid on June 30.
- The skipped payment is the clearest sign yet of an escalating crisis, writes AEP, as Syriza refuses to buckle and high statesmanship from Europe is so far absent. Syriza has the money on hand to make the payment, but says it won't burn any more of the country's dwindling cash until a credible bailout offer is on the table.
- NBG -8.9%
The Global X MSCI Greece ETF seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the MSCI All Greece Select 25/50 Index.
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