Chuyển tới nội dung
Trang chủ » ‘Shaking off ‘problem child of Europe’ label, Greek stocks experience a surge’

‘Shaking off ‘problem child of Europe’ label, Greek stocks experience a surge’

Greek stocks have soared as it shakes off 'problem child of Europe' tag

Greek stocks have soared as it shakes off ‘problem child of Europe’ tag

Greece’s ruling party, New Democracy, achieved an unexpectedly large share of the vote in Sunday’s national election, propelling the Athens General Composite Index up nearly 7%, with gains continuing into Tuesday. Although still short of a parliamentary majority, the party looks set to secure a victory in a June 25 election, under election rules that will award the party 50 additional parliamentary seats if it achieves over 40% of the vote again.

The strong daily movement was partly because the Greek market is “small and shallow,” with traders having priced in the potential for a three to four-party coalition that could create instability, said George Lagarias, chief economist at Mazars Wealth Management. Since taking power in 2019 under Prime Minister Kyriakos Mitsotakis, the incumbent government has been considered to be business-friendly, and investors now expect the kind of stability likely to come from a comfortable majority. A new vote still has to be called.

FAQs:

Why did the Athens General Composite Index shoot up nearly 7% on Monday?

Greek stocks rose sharply after Sunday’s national election, in which the ruling party, New Democracy, achieved an unexpectedly large share of the vote, propelling the Athens General Composite Index up nearly 7%.

Why is New Democracy not yet guaranteed a parliamentary majority?

New Democracy, led by Prime Minister Kyriakos Mitsotakis, remains short of a parliamentary majority. Another election has been set for June 25 under election rules that will award New Democracy 50 additional parliamentary seats if the party achieves over 40% of the vote again.

Why do investors expect stability in Greece

Since taking power in 2019, the incumbent Greek government under Prime Minister Kyriakos Mitsotakis has been considered to be business-friendly, and investors expect this kind of stability to continue with a comfortable majority. Although not yet a done deal, this is likely to happen in a repeat election on June 25 under election rules.

What has the government accomplished that makes it appealing to investors?

The government has made progress in improving Greece’s antiquated bureaucratic systems in areas such as taxation, and has also achieved the early repayment of Greece’s IMF loans, a high but declining debt-to-GDP ratio, a sustained rise in employment, and higher deposits, consumption, and corporate revenues. Greek GDP growth was 5.9% in 2022, above the 3.5% rate in the euro zone, and is forecast at 2.2% by the Greek central bank in 2023.

Greek stocks have soared as it shakes off 'problem child of Europe' tag
Greek stocks have soared as it shakes off ‘problem child of Europe’ tag

Greek stocks surge, defying its ‘problem child of Europe’ reputation.

Greek stocks experienced significant gains on Monday, following the recent national election that saw the incumbent New Democracy party achieve an unexpectedly high share of the vote at 40.8%, compared to the second-placed leftist Syriza party at 20.1%. Despite falling short of a parliamentary majority, the party is seen as a favorite to win the upcoming June 25 vote, under election rules that offer 50 additional parliamentary seats if the party achieves over 40% of votes again. This development has been seen as positive for the market, with Athens General Composite Index shooting up almost 7% as the result became clear. The index had risen by nearly 30% since the beginning of 2023 and was up by over 40% over the past year, reflecting the country’s economic improvements. Experts attribute these gains to improved investment-friendly policies, business-friendliness, and stability that the incumbent government has provided.

Trả lời

Email của bạn sẽ không được hiển thị công khai. Các trường bắt buộc được đánh dấu *