The Prague Stock Exchange is now the strongest in more than seven months. The PX index rose 1.34 percent to 1,320.41 points. It was last higher on June 9, 2017. The stock exchange was dragged up by shares of energy firm ČEZ, which rose about 4.5 percent. It follows from the results of trading on the stock exchange’s website. Thursday, the government’s Legislative Council (LRV) discussed a possible split of the semi-state company ČEZ.
The stock exchange has been appreciating for five days in a row. ČEZ securities, regularly among the issues traded in the most significant volumes, were the driving force behind the growth in the previous days. But Thursday’s rise was the biggest in five days, up 4.51 percent to CZK 915, the highest price for the company’s shares in more than a quarter of a year. Analysts said speculation about a company break-up was helping ČEZ shares to rise in price.
“The reason for the rapid growth is speculation on restructuring and an expected premium to the market price,” Bohumil Trampota, an analyst at Komerční banka, said of the rise in the ČEZ issue.
“Meanwhile, since the beginning of the year, (ČEZ shares) have already gained 18.83 percent on the wave of speculation about the upcoming government restructuring of the Czech energy sector. Today’s (Thursday’s) rise was mainly due to news about the forthcoming bill on corporate transformations, which would make it easier for the government to push through the split of ČEZ,” said Wood & Company broker Vladimír Vávra.
The LRV discussed the amendment to the law on transformations of commercial companies and cooperatives on Thursday. The passage of the amendment that deals with the possible division of ČEZ were not recommended to the cabinet for adoption. This is according to a statement by the Minister for Legislation and chairman of the council Michal Šalomoun (for the Pirates). The state is the majority shareholder in ČEZ, holding roughly 70 percent of the company’s shares through the Finance Ministry.
Half of the ten main issues on the Prague Stock Exchange gained on Thursday. ČEZ Securities gained the most. The shares of the insurance group VIG recorded the second-highest growth, up 1.38 percent to CZK 589. On the other hand, the shares of beverage producer Kofola CS suffered the most significant decline, which fell by 1.18 percent to 251 crowns.
The Czech currency weakened against both significant world currencies on Thursday. As of 17:00, the koruna had depreciated by two cents to CZK 23.82 to the euro and by 12 cents to CZK 21.94 to the dollar. This is according to information on the Patria Online server.