Slovakia's official SAX index eased 0.63 points to close at 97.42 in a quiet session on the Bratislava Stock Exchange (BSE) on October 7. The index was pulled down by losses to the issue of drug maker Slovakofarma, which has been in constant decline for several months. The issue closed down 173 crowns at 1,800 and its average price eased by 8.7%.
"There is not much to say about Slovakofarma now," a trader said. "Slovakofarma's GDR's abroad are still traded at a lower price than its domestic issue and that is probably the reason for the share's fall."
Brokers said foreign investors were currently uninterested in trading on the Slovak market and were waiting for the formation of a new government after September 25-26 national elections, which could bring more political stability to the country.
Overall volume including direct trades registered at the bourse fell to 17,299 shares from 360,685 shares traded on October 5. The index hit another record low, closing at 96.90, pulled down by a continuing easing in some of the most heavily-weighted issues. Turnover fell to 75.84 million crowns ($1.9 million) from 241.89 million crowns.
Brokers said the floating crown exchange regime, introduced by the central bank last week, should have a positive effect on the capital market in the long term. "Investors are cautious about this," one local broker said. "Even if Slovak blue chips are cheaper after the crown devaluation, they are almost illiquid, due to bigger problems on the Slovak market, and this keeps them less attractive than similar papers on stock exchanges over the region."
Oil refiner Slovnaft dominated and rose 10 crowns to 680. "With such absurdly low activity it is really not possible to draw any conclusions whatever about direction on this market," said the dealer.