Greek market recovers some poise, but banks hammered again

Tue Aug 4, 2015 11:53am EDT
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By George Georgiopoulos and Jeremy Gaunt

ATHENS (Reuters) - Greece's banking stocks plunged for the second day in a row on Tuesday, holding down the main Athens index which otherwise turned the corner after the previous day's record rout.

Nineteen of the exchange's 25 blue-chip stocks rose on the day, and the main index .ATG, of which around 20 percent is banks, was down only 1.2 percent.

Officials said they expected the coming days would see trading calm down.

With lenders in dire need of recapitalization after a flight of euros from deposits for most of this year, the banking index closed down more than 29 percent, effectively at its 30 percent daily loss limit at which trading is halted. It was at that limit on Monday.

Many non-financial sector indexes gained on Tuesday. The blue chip retail sector .FTATRET, for example, was up more than 11 percent, driven by a similar rise in its main component, international jewelry chain Folie Folie (HDFr.AT: Quote).

The gains in non-financials suggested that historically low valuations were attracting investors and that fears of further turmoil between Greece and its international lenders were primarily consigned to banks.

"The second day of trading showed clear signs we are moving towards a normalization of the market after the long shutdown," said Socrates Lazaridis, chief executive officer of Hellenic Exchanges.

Among gainers were gaming group OPAP (OPAr.AT: Quote), up 4.2 percent, and Aegean Airlines (AGNr.AT: Quote), 8.8 percent.   Continued...

A Greek flag flutters outside the Athens stock exchange , Greece,  July 27, 2015.   REUTERS/Ronen Zvulun