The high volatility in the capital markets has revealed an unexpected refuge for risk-averse investors in a “poor and unstable political corner of Europe”, Profit.ro reads quoting a Bloomberg comment about the performance of the Bucharest Stock Exchange recently.
Romania has outperformed most of its counterparts globally in the first six months of this year, in the context of low base, robust financial results and rapid economic growth.
The main market index BET has recovered strongly after being pushed down to a two-year low by the controversial emergency ordinance OUG 114/2014, expected to negatively impact banks, energy companies and telecoms, at the end of 2018.
During the first 6 months of the year, the BET index rose by 20%, according to BVB data, the second big jump among the main stock market indices in the EU. Being a frontier market and having local pension funds as stable investors, Romania’s exchange is less exposed to the volatility of the global markets.
At the same time, the Romanian shares are attractive to investors due to the low valuations. BET shares are trading at a price to earning ratio (PER) of 7.8 compared to 12 in the Czech Republic and Poland, 12 average PER for MSCI Emerging Markets and 18 for Stoxx Europe 600.
(Photo: Bursa de Valori Bucuresti Facebook Page)
Bucharest Stock Exchange's blue chips index BET outperformed by 4.8 percentage points (pp) the average yield of the...