Investopress brings you a weekly market review of the Bucharest Stock Exchange (BVB), along with key economic, political, business and other important Romanian market moving news of the week. The content of this review is for informational purposes only and should not be interpreted as specific investment advice.
On Monday, the benchmark BET index, which includes the most traded 19 companies except for the Financial Investment Companies (SIFs), fell 0.17% to 12,611.18 points.
The BET-TR index, which also includes the dividends offered by the companies from the BET index, dropped 0.18% to 22,319.46 points.
The BET-FI index which tracks the five SIFs and the property restitution fund Fondul Proprietatea, lost 0.55% to 53,016.26 points.
The BETPlus Index which tracks the price changes of Romanian companies listed on BVB’s Regulated that minimum selection criteria of liquidity and free float, was lower by 0.14% to 1,882.08 points. Financial investment companies are excluded from the index.
In industrial news, Romania's industrial production prices up 15.9% y-o-y in August, data from the National Institute of Statistics (INS) showed Monday.
On Tuesday, the BET index ticked up 0.02% to 12,613.43 points. The BET-TR also added 0.02% to 22,322.92 points. The BET-FI index climbed 0.38% to 53,216.46 points. The BET Plus ticked up 0.01% to 1,882.35 points.
In politics, the government of liberal Prime Minister Florin Citu has been brought down by a no-confidence vote in parliament on Tuesday (Oct. 5), threatening fresh political instability. The opposition center-left Social Democrats (PSD) accuse his government of "impoverishing Romanians and increasing the country's debts". The no-confidence motion was backed by 281 MPs, well in excess of the 234 required.
Centre-right President Klaus Iohannis called on political parties to hold consultations next week on forming a new government before he nominates a new premier.
In monetary policy news, the National Bank of Romania raised its benchmark interest rate by 25bps to 1.5% at its Oct.5 meeting, as expected, for the first time since 2018. The move aims to bring back and maintain the annual inflation rate, which is projected to climb 5.6% by year-end.
On the macro front, the World Bank revised up Romania’s GDP growth forecast to 7.3% in 2021 vs 6% previously.
On Wednesday the BET index gained 0.16% to 12,633.72 points while the BET-TR also moved up 0.16% to 22,359.43 points. The BET-FI index grew 0.27% to 53,362.43 points. The BET Plus grew 0.17% to 1,885.62 points.
In business news, Romania’s e-commerce market ranks 50th globally, with a value of $3 billion in 2020, ahead of Bangladesh and below Singapore, according to ecommerceDB.com
Meanwhile, Romania's food retail sector reached EUR19 billion last year. The sector is expected to grow on average 5% per year and reach EUR25 billion in 2025, a report by research and analysis firm Roland Berger showed.
Retail sales in the country (excluding sales of motor vehicles and motorcycles) increased by 12.4% y-o-y in the first eight months of the year, INS data showed.
On the energy front, Romania's pavilion at Expo 2020 Dubai hosted on Wednesday the seminar "The Future of Energy, Bringing Together Conventional and Alternative Sources", which is intended to promote the exchange of best practices as a platform for the identification of sustainable energy solutions
On Thursday, the BET index climbed 0.87% to 12,743.60 points while the BET-TR climbed 0.88% to 22,555.15 points. The BET-FI rose 0.11% to 53,421.45 points while the BETPlus was higher by 0.85% to 1,901.57 points.
In fixed income markets, three new Fidelis government bond issues for the general population, denominated in the local currency and euro, started trading on the Main Market of the BVB under the trading symbols R2210A, R2410A and R2610AE, respectively. It is the fifth offer of government securities carried out by the Ministry of Finance on the local bourse in the last five quarters.
The Romanian capital market surged by 29% in the first 9 months when looking at the BET index, and by 35.6% when taking into account BET-TR, which includes also dividends, BVB said on Thursday (Oct. 7). The total trading value for all the financial instruments traded on Bucharest Stock Exchange (BVB) amounted to RON 13 billion, +4.2% as compared to the first 9 months from the previous year.
In business news, the average value of a transaction closed in Romania stood at $15 million in 2021, lower by 24% than the average recorded in 2020. Domestic deals grew by 13%, accounting for half of the volume of transactions and averaging $8 million per deal, according to EY data.
Romania's business services industry's revenues stood at EUR9 billion in 2019, employing some 179,000 people countrywide and having almost 1,080 firms registered at the finance ministry with specific CAEN (Classification of Activities in the National Economy) codes, a survey by the Association of Business Service Leaders in Romania (ABSL) in association with PwC Romania showed.
On Friday, the BET index added 0.58% to 12,817.57 points while the BET-TR rose 0.58% to 22,686.00 points. The BET-FI advanced 0.07% to 53,457.54 points. The BET Plus gained 0.55% to 1,912.06 points.
In fixed income markets, Romania raised RON723 million (EUR146.1 million) this week after selling bonds at average yields of 2.49% and 3.86%, respectively.
(BET index performance on Friday 08/10/2021 Source: BVB)
BET INDEX CONSTITUENTS
Below are the 19 companies that are part of the BET and BET-TR indices:
1.Alro (ALR) one of the largest vertically integrated aluminium producers in Europe.
2. Banca Transilvania (TLV), the first Romanian bank listed on the BVB and Romania's largest lender by assets.
3. BRD Groupe Societe Generale (BRD), the third largest bank in Romania by assets whose majority shareholder is France's Societe Generale,
4. Bucharest Stock Exchange (BVB) the parent company of the Bucharest Stock Exchange
5. Conpet (COTE) the operator of the National Transport System of crude oil via pipelines.
6. DIGI Communications N.V. (DIGI) the parent company of RCS & RDS-one of the biggest telecommunication operators in Central and Eastern Europe and the largest cable and satellite television company in Romania.
7. Electrica (EL), the biggest electricity distributor and supplier in Romania.
8. Fondul Proprietatea (FP) a joint stock company operating as an Alternative Investment Fund.
9. MedLife (M) one of the largest private medical operators in Romania.
10. OMV Petrom (SNP), the largest oil and gas group in Southeastern Europe.
11. Nuclearelectrica (SNN) , the state-owned operator of Romania's sole nuclear power plant,
12. One United Properties (ONE), one of Bucharest’s most dynamic developers of housing, office and mixed projects.
13. Purcari Wineries (WINE), the largest wine exporter from Moldova.
14. Romgaz (SNG), Romania’s largest natural gas producer and supplier.
15. Sphera Franchise Group (SFG) a holding company which manages restaurants under the KFC, Pizza Hut and Taco Bell brands.
16. TeraPlast (TRP) the largest Romanian producer of construction materials.
17.Transgaz (TGN) the Romanian state-controlled gas transporter.
18. Transelectrica (TEL), electricity transmission system operator.
19 .Transport Trade Services (TTS), river/maritime and land transport of bulk and packed commodities goods, handling of goods and equipment in Danube ports and Constanta, door to door transportation.
BET INDEX CONSTITUENTS NEWS
- BVB on Monday (Oct. 4) revealed a new identity, aiming to reposition the brand as a suitable choice for the investments of each Romanian and a catalyst for the development of companies in Romania.
- Romgaz and US energy giant ExxonMobil extended an exclusivity agreement on negotiation of deal for Neptun Deep
- Romania’s Competition Council cleared the acquisition of Idea Bank Romania by Banca Transilvania
- OMV Petrom reported a 10% drop in natural gas production in the third quarter of 2021 compared to the second quarter and a 15% fall compared to the third quarter of 2020.