PX Index Ends 2017 Up 17% – Highest Level in 6 Years

Prague, Dec 29 (CTK) – Czech shares have grown by 17 percent this year in terms of the PX index, which is closing year 2017 at 1,077 points, and the Prague Stock Exchange (BCPP) hit six-year highs in the course of the year, according to today’s results from the bourse.


Fortuna lottery company and Unipetrol petrochemical group ranked among the biggest gainers, they have doubled their price.


Czech shares dropped 4 percent last year and 1 percent in 2015, according to the PX index.


“The PX index has reached the strongest level this year since August 2011, it added 17 percent in the course of the year,” Cyrrus analyst Lukas Kovanda told CTK.


Apart from specific reasons for the gains of the individual stocks, the factors contributing to the firming of the Czech shares were the strong growth of the domestic economy, acceleration of robust expansion of the German and euro-zone economies, continuation of solid growth in the USA and growth on global stock markets.


Within the PX index, Fortuna’s shares rose by 109 percent and Unipetrol’s shares by 105 percent.


None of the main stocks traded on the BCPP was on the losing side. Komercni banka with a 3.6 percent growth did relatively the worst.


“The year was better than expected for the Prague Stock Exchange, the same as for the global stock markets,” Kovanda said.


This year’s improvement on the BCPP was the best since the year 2009 which, however, was exceptional thanks to the correction after the record decline in 2008.


Since the beginning of January, the Prague bourse has grown more than, for example, the German DAX index. Even thus, the PX index is still some 55 percent below the pre-crisis high, he added.


When including dividends, investors on the BCPP have gained over a 20 percent appreciation this year, said BH Securities analyst Martin Vlcek.


He recalled that the PX index depends a lot on the performance of several shares with the highest weight in it. They are CEZ energy group and financial stocks like Komercni banka, Erste Bank, VIG insurer and newly also Moneta Money Bank.


“Not all banks performed well. In particular Moneta and Komercni banka were posting quite high losses in the last few weeks,” Vlcek remarked.


“Some shares with a lower weight in the index helped a lot as well thanks to their very high gains. In particular Unipetrol and Fortuna pleased investors,” he added.


Prices of electricity with supply in future years look much more optimistic than in the past years, they have changed significantly to the better since the beginning of this year.


After years of declines, CEZ is thus finally able to get growing selling prices for the future. Expecting stop to the falls in profits in the coming quarters and a probable gradual growth, investors have ceased to sell CEZ shares and started buying them. “The price has probably reached its cyclic bottom,” he estimated.


As for Unipetrol, the surplus of oil on the market has raised the attractiveness of refineries and caused a rise in the difference between the price of oil as a raw material and the selling price of completed products, for example petrol and diesel oil.


Thanks to this and also to new investments in raising oil processing capacity, Unipetrol’s shares became more attractive for investors, he explained.