LIVE MARKETS-Next week, Greece's STOXX odyssey ends
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NEXT WEEK, GREECE'S STOXX ODYSSEY ENDS
Odysseus took two decades to return to Ithaca. Greece's stock market has spent the past 13 years charting its own journey back to the developed world.
On Monday, nine Greek companies will join the STOXX 600 .STOXX after the country's equity market was reclassified from emerging to developed status.
The newcomers are the country's top largest banks, Eurobank EURBr.AT, National Bank NBGr.AT, Piraeus BOPr.AT and Alpha ACBr.AT, alongside industrial and energy names Public Power DEHr.AT, Metlen Energy , GEK Terna HRMr.AT and Motor Oil MORr.AT, and retailer Jumbo BABr.AT.
The move marks a symbolic milestone in Greece's recovery from the sovereign debt-crisis era, returning domestic champions to a benchmark tracked by global investors.
Little wonder, then, that Greek stocks are attracting fresh sell-side attention.
KBW analysts Ben Mahler and Hugo Cruz on Thursday launched coverage of Piraeus and National Bank with "outperform" ratings, Eurobank at "market perform" and Alpha Bank at "underperform".
The brokers argue Greek banks offer some of the strongest loan-growth prospects in the sector, helped by corporate lending, a recovery in mortgages and improving economic conditions. They also note capital ratios have improved sharply, while deferred tax credit exposure declining.
They say the sector still trades at roughly a 5% discount to European peers even as returns on tangible equity run in the mid- to high-teens.
Their verdict: "No Trojan horse here, just high teen RoTEs."
(Danilo Masoni)
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