The BVB indices set new historical records in the last month of last year

The indices of the Bucharest Stock Exchange (BVB) had linear increases in the last month of last year, in an international climate favorable to risky assets, on top of which some internal elements were superimposed that supported share prices. The BET index, of the twenty most liquid stocks on the BSE, advanced 4.5% last December to 15,371 points, after our market's main basket of shares during the month marked a new historical record of 15,531 points. Overall, in 2023, BET had nominal growth of 31.8%, admittedly in an environment of high inflation that eroded real returns, but even so the evolution of the index is remarkable.

The BET-NG index, of energy and utility companies, rose 3.6% last month, while the BETAeRO index, of companies considered relevant to the BSE's Multilateral Trading System, rose 3.9%.

• Traders see more than 60% chance Fed will cut rates in March, according to CME FedWatch Tool

In the United States, indices were up on the back of expectations that the Federal Reserve will start cutting interest rates this year and inflation decelerating. The S&P 500 rose 4.4% last month after nine straight weeks of gains, its longest streak since 2004, while the Nasdaq Composite index of knowledge-intensive companies advanced of 5.5% last month.

The Fed left its key interest rate unchanged in December for the third time in a row, and markets expect the US central bank to make three to four rate cuts this year. According to the CME FedWatch Tool, traders see about a 63% chance the Fed will cut interest rates by 25 basis points at the March meeting.

On our side of the Atlantic, where there are also expectations of rate cuts this year, the pan-European Stoxx 600 rose 3.8% in December, while Frankfurt's DAX40 climbed 3.3 %, last month.

• 4.4% appreciation for BET-XT

At the Bucharest Stock Exchange, the BET-XT index, which reflects the evolution of the thirty most liquid securities of our market, had an advance of 4.4%, in December, to 1,324 points, after, during the month, the basket of shares reached a new historical record of 1,335 points. Fondul Proprietatea bought back about 30% of its own shares, through an offer carried out at a price above the market price, which was oversubscribed.

For the securities bought back from the BSE, FP paid almost one billion lei, part of the money probably returning to the market, which supported the increase in the share prices of other important companies on our stock exchange.

• Sphera, Electrica and TeraPlast - performers of the month of December, from the BET index

Acţiunile Sphera Franchise Group (SFG) au crescut cu 25,4%, luna trecută, la 25,7 lei, cel mai ridicat nivel din vara anului 2018, pe fondul unor volume mari, ceea ce arată achiziţii din partea instituţionalilor.

La începutul lui decembrie, Erste recomanda "Cumpărare" pentru titlurile SFG, cu un preţ ţintă de 26,1 lei pe acţiune, pentru următoarele douăsprezece luni, cu circa 21% peste cotaţia titlurilor din piaţă din acel moment, conform unui raport publicat pe portalul BVB Research Hub. "Rezultatele la nouă luni ne validează perspectiva pozitivă asupra acţiunilor, indicând o creştere semnificativă a profitabilităţii în ritm anual şi o performanţă mai bună trimestrială (...). Ne aşteptăm ca ultimul trimestru să valideze tendinţa pozitivă actuală a profitabilităţii", se menţiona în raport.

Analiştii de la Prime Transaction estimează că Sphera va distribui, anul viitor, un dividend de 1,84 de lei, echivalentul unui randament brut de 8,5%, raportat la preţul acţiunii SFG din 4 decembrie (data raportului), printre cele mai mari de la BVB.

Titlurile Electrica (EL) au urcat cu 17,4%, luna trecută, la 11,48 lei, probabil în urma achiziţiilor făcute de instituţionali, după cum se poate deduce din volumele ridicate. Compania a îndeplinit criteriile pentru intrarea în indicii internaţionali ai FTSE Russell, acţiunile sale urmând să fie incluse în indicii FTSE Global All Cap şi FTSE Global Mid Cap.

Acţiunile TeraPlast (TRP) au urcat cu 9,9%, la 0,515 lei pe titlu, în decembrie, echivalentul unui raliu în trendul descendent multianual pe care se află acţiunile companiei încă din 2021, în vreme ce titlurile Transport Trade Services (TTS) şi-au continuat tendinţa ascendentă dezvoltată anul trecut, cu avans de 8,4% în decembrie, până la 27 de lei.

• BRD will distribute a dividend with a yield of 5%

Shares of the main banks on the BSE ended the year on the up, in a month in which the Euro Stoxx Banks index saw a slight appreciation. The securities of BRD-Groupe Societe Generale (BRD) rose by almost 8%, to 17.92 lei, while the shares of Banca Transilvania (TLV) increased by 5.6%, to 24.26 lei, the securities of the credit institution from Cluj trading close to historical highs.

Banks benefit from the high interest rates of the last period, which is reflected in profitability. Last month, BRD shareholders approved the distribution as dividends of 50% of the carried forward result for 2022, the allocation having a yield of about 5%.

• The first natural gas extracted from Neptun Deep will be delivered in 2027, according to OMV Petrom

The shares of Romgaz (SNG), a company that will achieve a capital increase of almost 3.5 billion lei by incorporating some reserves, had an advance of 4.4%, up to 50.1 lei, last month, in while the shares of OMV Petrom (SNP) appreciated by 6.2%, to 0.5745 lei. The two companies will deliver the first quantities of natural gas from Neptun Deep in 2027, over 80% of the value of the execution contracts related to the project having already been assigned to contractors and suppliers, according to a Petrom report from December.

Transgaz (TGN) shares appreciated by 3.5%, last month, to 18.9 lei, while Conpet (COTE) shares advanced by 5.7%, to 81.8 lei.

Among the declines in the BET index, the MedLife (M) shares stand out, which depreciated by 2.7%, last month, to 3.98 lei, given that the company's profitability fell severely, in the first nine months of 2023, indicating a year with poor results for the private healthcare provider.

• 66% trading discounts for Lion Capital and Infinity Capital Investments; SIF Muntenia had a 49% discount at the end of December

The BET-FI index, of SIFs plus Fondul Proprietatea, rose by 2.4% last month, to 59,309 points, the lowest appreciation among BVB indices. FP announced the signing of the sale-purchase agreement for its stake in Engie Romania, for 432.6 million lei, and convened the shareholders to approve the buyback of one billion FP shares (equivalent to 17% of the Fund's capital) and the sale of stakes in the companies Bucharest, Constanţa Port, Salrom and Alro airports, under certain conditions.

At the end of the month, the SIFs traded at discounts between the price and the Net Asset Unit Value (VUAN) located between 66% for Lion Capital and Infinity Capital Investments, while the SIF Muntenia securities had a relative difference to the asset level net of 49%. In the case of FP, the discount was 17%, slightly above administrator Franklin Templeton's goal of under 15%.

Last month, the Ministry of Finance listed a new issue of Fidelis government bonds at BVB, worth 2.47 billion lei, respectively 497.7 million euros. The offer was made in five installments - three in lei, including one dedicated to blood donors, and two in euros. The tranches in lei are due in 2024, 2026, with annual interest rates of 6.1% and 7.25%, respectively. For the installment of blood donors, the maturity is in 2024 and the interest rate is 7.1%. In the case of euro bonds, the maturities are in 2024 and 2028, with annual interest of 4% and 5.5%, respectively.