This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.theguardian.com/business/2015/aug/03/greece-stock-market-nosedives-reopening

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Greece stock market nosedives after five-week shutdown Greece stock market nosedives after five-week shutdown
(35 minutes later)
Greece’s stock market plunged nearly 23% on Monday when it opened after a five-week shutdown brought on by fears that the country was about to be dumped from the eurozone. Greece’s stock market plunged nearly 23% on Monday when it reopened after a five-week shutdown brought on by fears that the country was about to be dumped from the eurozone.
The main Athens stock index plunged in its worst ever one-day performance after only a few minutes of trading. The main Athens stock index fell to in worst ever one-day performance after only a few minutes of trading.
Related: Greece debt crisis: Athens stock market falls 23% after reopening - liveRelated: Greece debt crisis: Athens stock market falls 23% after reopening - live
Banking shares, which make up about 20% of the index, were particularly hard hit. National Bank of Greece, the country’s largest commercial bank, was down 30%, the daily volatility limit. The overall banking index was also down to its 30% limit.Banking shares, which make up about 20% of the index, were particularly hard hit. National Bank of Greece, the country’s largest commercial bank, was down 30%, the daily volatility limit. The overall banking index was also down to its 30% limit.
The nearest blue-chip futures contract expiring in August traded down 20.5%, adding to losses of 15.2% at the open.The nearest blue-chip futures contract expiring in August traded down 20.5%, adding to losses of 15.2% at the open.
“Most of the selling pressure is seen in bank shares, where there is about €100m [£70m] worth of unexecuted selling orders,” said investment adviser Theodore Mouratidis.“Most of the selling pressure is seen in bank shares, where there is about €100m [£70m] worth of unexecuted selling orders,” said investment adviser Theodore Mouratidis.
“There may be some more slide in store for [Tuesday] unless buyers emerge later in the session.”“There may be some more slide in store for [Tuesday] unless buyers emerge later in the session.”
Trading on the Athens exchange was suspended in late June as part of capital controls imposed to stem a debilitating outflow of euros that threatened to collapse Greece’s banks and hurl the indebted country out of the eurozone. Trading on the Athens exchange was suspended in late June as part of capital controls imposed to stem a debilitating outflow of euros that threatened to collapse Greece’s banks and send the indebted country out of the eurozone.
Related: Greek shares set to fall sharply as Athens stock market reopensRelated: Greek shares set to fall sharply as Athens stock market reopens
Since then, Athens has agreed a framework bailout plan with its European Union partners in exchange for stringent reforms and budget austerity. Since then, Athens has agreed a framework bailout plan with its European Union partners in exchange for stringent reforms and budget austerity. But implementation of the deal is some way off, keeping alive concerns about political and economic stability. There is also concern that the prime minister, Alexis Tsipras, may need to call a snap election.
But implementation of the deal is some way off, keeping alive concnerns about political and economic stability. There is also concern that Prime Minister Alexis Tsipras may need to call a snap election.
The Athens General Index has fluctuated sharply in a year in which Tsipras’s Syriza-led government has wrangled bitterly with EU, the European Central Bank and International Monetary Fund lenders over a third bailout.The Athens General Index has fluctuated sharply in a year in which Tsipras’s Syriza-led government has wrangled bitterly with EU, the European Central Bank and International Monetary Fund lenders over a third bailout.
Traders had been expecting losses on Monday for a number of reasons. Negotiations on a new bailout might bog down, for example, leaving the government and banks perilously short of cash.Traders had been expecting losses on Monday for a number of reasons. Negotiations on a new bailout might bog down, for example, leaving the government and banks perilously short of cash.
A report on Sunday in Avgi newspaper, which is close to Syriza, said the government was seeking €24bn in a first tranche of bailout aid from international lenders in August.A report on Sunday in Avgi newspaper, which is close to Syriza, said the government was seeking €24bn in a first tranche of bailout aid from international lenders in August.
Related: Who’d be young and Greek? Searching for a future after the debt crisisRelated: Who’d be young and Greek? Searching for a future after the debt crisis
Of this, the newspaper said, €10bn was earmarked for an initial recapitalisation of Greek banks, €7.16bn to repay an emergency bridge loan and €3.2bn to repay Greek bonds held by the European Central Bank and others.Of this, the newspaper said, €10bn was earmarked for an initial recapitalisation of Greek banks, €7.16bn to repay an emergency bridge loan and €3.2bn to repay Greek bonds held by the European Central Bank and others.
The European Commission, however, believes an agreement in August is unlikely and that a new bridge loan will be needed. The European commission, however, believes an agreement in August is unlikely and that a new bridge loan will be needed.
This all puts Greek bank shares in the spotlight. Recapitalisation, both long- and short-term, waters down the value of existing shares. The banks are also not making profits this year and have lots of bad loans.This all puts Greek bank shares in the spotlight. Recapitalisation, both long- and short-term, waters down the value of existing shares. The banks are also not making profits this year and have lots of bad loans.
Similarly, Greeks themselves are being severely restricted. To limit the possibility of using shares as part of euro-flight, the government and ECB have said no extra money can be withdrawn by Greeks from deposit accounts to buy shares.Similarly, Greeks themselves are being severely restricted. To limit the possibility of using shares as part of euro-flight, the government and ECB have said no extra money can be withdrawn by Greeks from deposit accounts to buy shares.
A Greek regulatory source also said the government would extend a ban on stock selling when it expires later on Monday.A Greek regulatory source also said the government would extend a ban on stock selling when it expires later on Monday.
Greece’s dismal economic prospects may also affect the market. The European commission says the Greek economy will shrink by 2% to 4% this year, a return to the recession that plagued the country for six years until 2014.Greece’s dismal economic prospects may also affect the market. The European commission says the Greek economy will shrink by 2% to 4% this year, a return to the recession that plagued the country for six years until 2014.
On Monday, a survey showed Greek manufacturing activity plunged to a record low as new orders plummeted and the three-week bank shutdown caused serious supply problems.On Monday, a survey showed Greek manufacturing activity plunged to a record low as new orders plummeted and the three-week bank shutdown caused serious supply problems.