bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

hooksAmpRedirectArticle

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

paywallTypes

createdDate

publishedDate

urlAlias

moreOnThisArticles

sponsorType

commentCount

authorLocations

authors

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

articleSpeeches

socialHeadline

headline

images

flag

firstTopic

glossary

flattenTypeIds

image

relatedLinks

relatedNewsletters

__typename

sponsor

pdfFiles

seriesReverseOrder

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

readingTime

customTimezone

liveContents

Reuters

Greece’s stock market plunged nearly 23 per cent on Monday when it opened after a five-week shutdown brought on by fears the country was about to be dumped from the euro zone.
The main Athens stock index plunged in its worst ever one-day performance after only a few minutes of trading.
Banking shares, which make up about 20 per cent of the index, were particularly hard hit. National Bank of Greece, the country’s largest commercial bank, was down 30 per cent, the daily volatility limit. The overall banking index was also down to its 30 per cent limit.
The nearest blue chip futures contract expiring in August traded down 20.5 per cent, adding to losses of 15.2 per cent at the open.
“Most of the selling pressure is seen in bank shares, where there is about 100 million euros worth of unexecuted selling orders,” said investment adviser Theodore Mouratidis.
“There may be some more slide in store for Tuesday unless buyers emerge later in the session,” he said.
Trading on the Athens bourse was suspended in late June as part of capital controls imposed to stem a debilitating outflow of euros that threatened to collapse Greece’s banks and hurl the indebted country out of the euro zone.
Since then, Athens has agreed a framework bailout plan with its European Union partners in exchange for stringent reforms and budget austerity.
But implementation of the deal is some way off, keeping alive political and economic stability concerns. There is also concern that Prime Minister Alexis Tsipras may need to call a snap election.
The Athens General Index has fluctuated sharply this year, which has seen Tsipras’s newly elected Syriza government wrangle with European Union and International Monetary Fund lenders in bitter bailout talks.
Traders had been expecting losses on Monday for a number of reasons. Negotiations on a new bailout might bog down, for example, leaving the government and banks perilously short of cash.
A report on Sunday in Avgi newspaper, which is close to Syriza, said the government was seeking 24 billion euros (US$26.37 billion) in a first tranche of bailout aid from international lenders in August.
Of this, the newspaper said, 10 billion euros was earmarked for an initial recapitalisation of Greek banks, 7.16 billion euros to repay an emergency bridge loan and 3.2 billion euros to repay Greek bonds held by the European Central Bank and others.
The European Commission, however, believes an agreement in August is unlikely and that a new bridge loan will be needed.
This all puts Greek bank shares in the spotlight. Recapitalisation, both long- and short-term, waters down the value of existing shares. The banks are also not making profits this year and have lots of bad loans.
Similarly, Greeks themselves are being severely restricted. To limit the possibility of using shares as part of euro-flight, the government and ECB have said no extra money can be withdrawn by Greeks from deposit accounts to buy shares.
A Greek regulatory source also said the government would extend a ban on stock selling when it expires later on Monday.
Greece’s dismal economic prospects may also weigh on the market. The European Commission says the Greek economy will shrink by 2 to 4 per cent this year, a return to the recession that plagued the country for six years until last year. 
On Monday, a survey showed Greek manufacturing activity plunged to a record low as new orders plummeted and the three-week bank shutdown caused serious supply problems. 


Greek stock market plunges more than 20 per cent after five-week shutdown

Stock prices plummeted when the Athens Stock Exchange reopened for trading on Monday. Photo: AP

Wall Street, global stocks climb on signs Greek crisis may be resolved

Traders work the floor of the New York Stock Exchange as markets around the world rose on Wednesday on hopes a resolution to the Greek crisis may be in sight. Photo: EPA

News

World

Business

Markets

 Banking shares hit hard as limits on trading by Greeks weigh on market 


Greece’s stock market plunged nearly 23 per cent on Monday when it opened after a five-week shutdown brought on by fears the country was about to be dumped from the euro zone.


Greek stock market plunges more than 20 per cent after five-week shutdown

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;} Banking shares hit hard as limits on trading by Greeks weigh on market

Banking shares hit hard as limits on trading by Greeks weigh on market