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BLOOM

Greek stocks, which were once shunned by investors concerned that a default would force the country out of the euro zone, are beating almost every market in the world as a six-year recession eases and new investors consider purchases.
Since June 5 last year, two weeks before MSCI gave notice it might reclassify Greece as an emerging market, the country's ASE Index has surged 146 per cent, trimming the decline from its 2007 peak to 79 per cent.
The gains topped all 94 national benchmarks globally in the period, except for Venezuela's.
Yields on Greece's 10-year government bonds have dropped to 8.31 per cent from a peak of 33.7 per cent in March last year.
Paulson & Co and JPMorgan Chase have bought shares as emerging-market funds including Renaissance Capital and Templeton Emerging Markets expressed interest.
JPMorgan's Francesco Conte, who dumped Greek stocks from his European Small Cap Fund more than three years ago as the government's budget deficit spiralled, has bought stakes in retailer Jumbo and jewellery maker Folli Follie after the world's biggest sovereign debt restructuring.
"The outlook for the country has completely changed," said Conte, who manages about US$2.8 billion.
"I'm very overweight Greece because I find very, very good opportunities, very well-run companies and very cheap valuations.
"Greece is only just emerging from the crisis.
"Because they've cut their cost bases so low, the profitability growth is going to be enormous if we get positive [gross domestic product] growth."
The Greek recession shows signs of easing after the country cut wages and pensions and increased taxes to meet targets linked to its two bailouts from the European Union and the International Monetary Fund.
Prime Minister Antonis Samaras plans to trim the budget deficit to 2.4 per cent next year, down from 9 per cent last year and a peak of 15.7 per cent in 2009.
The government forecast last month GDP would increase 0.6 per cent next year, the first annual expansion since 2007.
Flows into equity funds investing in Greece rose 129 per cent this year, against a 15 per cent gain for Europe as a whole, data from EPFR Global showed.
Investors have poured US$179 million into Greek stocks this year, according to the data.
The Greek recession has destroyed almost a quarter of its economic output and sent unemployment surging to a record 27.6 per cent. The stock market fell 91 per cent from October 2007 to a 22-year low in June last year.


Greek stock market hottest in the world

Greek Prime Minister Antonis Samaras plans to trim the budget deficit to 2.4 per cent next year, down from 9 per cent last year and a peak of 15.7 per cent in 2009. Photo: AFP

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Equities have bounced back 146 per cent since June 2012, when fears of an euro exit peaked


Greek stocks, which were once shunned by investors concerned that a default would force the country out of the euro zone, are beating almost every market in the world as a six-year recession eases and new investors consider purchases.
