Bets on Stock Exchange in 2010: energy, utilities and the food industry

Fund managers are not highly upbeat with regard to the profits the Stock Exchange is going to bring in 2010, betting more on stocks related to defensive fields, such as energy, utilities and the food sector, which should preserve last year’s profits.

The Stock Exchange was by far the most profitable investment in 2009, with investors that bet on stocks such as Rompetrol Rafinare (RRC) or Alumil aluminium trim producer (ALU) tripling their money, while those who bet on SIFs made profits of above 100%. Banca Transilvania (TLV) or Erste Bank (EBS) stock also doubled investors’ money, though nobody would have dared bet on banks early last year.

SIFs are still the favourites when it comes to generating returns above the market average, owing to the legislative draft on raising the stake cap from 1% to 5%, but banks, with falling profits, are no longer to investors’ taste.

Those wanting to know what the future surprises on the Stock Exchange might be should particularly look at what fund managers do. For instance, Active Dinamic, the best performing mutual fund in 2009, which for the first time generated an annual return of 100%, counted on little visible stocks on the market such as Socot Targu Mures (SCTO), which rose by 270% last year.

Capital market specialists, managing hundreds of million euros for clients, expect the positive trend of the Bucharest Stock Exchange to continue in 2010, but at slower pace than last year. They are again betting on SIFs, as a driver of the market, as well as on energy stocks.