Donald Trump’s trade tariffs have cost the Athens Stock Exchange more than 7 billion euros so far, with the General Index, amid the international uncertainty and concern, gradually abandoning 15-year highs and putting a (temporary) end to the prolonged rally, which has been running since last November.
This is a correction, which has affected the previously impeccable market returns, but at the same time it can be considered normal – if not necessary – development.
Moreover, the strong upward trend of the previous months (from 1,366 points in November to 1,746 points in March) had offered the stock market large reserves in order to be able to absorb the shocks of the international turmoil. Certainly, a possible recession of the global economy, as a result of the escalation of the trade war, could worsen the situation, further shaking the “foundations” of the General Index. However, we are not at that point at the moment.
The General Index is still trading clearly above the main support point of 1,500 points, which coincides with the average of the last 200 days. Only if this is lost, we will start to worry, having second thoughts about the sustainability of the positive long-term trend.
At the same time, optimists have every reason to remain “faithful” to the Athens stock market’s prospects. The strong fundamentals, generous dividends, business deals, satisfactory discounts compared to abroad, and the outperformance of the domestic economy are factors that can rekindle buying interest at any time. Provided, of course, that things do not get worse on the international scene.
Also, on Tuesday, April 8 – the Greek market awaits the interim review of FTSE Russell, which is likely to give a date for the reinstatement of the ATHEX in Developed Markets, putting an end to the “black spot” opened by the financial crisis of the previous decade.
