April 2 (Bloomberg) -- The Cyprus General Market Index declined the most in three weeks as the stock market reopened following a two-week closure imposed as policy makers wrangled over the terms of a 10 billion-euro ($13 billion) bailout.
The benchmark measure retreated 2.6 percent to 99.46 at the close in Nicosia as Hellenic Bank Pcl sank 20 percent, cruise operator Louis Plc tumbled 18 percent and Logicom Ltd. fell 10 percent. There was no volume in the index’s other 15 stocks. Traders completed 38 transactions today for a total of 19,209 euros, according to the Cyprus Stock Exchange website.
Cypriot shares last traded on March 15 as euro-area leaders tried to force losses on all bank depositors to cut the cost of financial aid for the Mediterranean nation. While parliament rejected that plan, a subsequent agreement imposed larger fees on deposits greater than 100,000 euros and shut Cyprus Popular Bank Pcl. Amid the crisis, Cyprus set a 300-euro daily limit on bank withdrawals and restrictions on transfers to accounts outside the country.
“The whole issue is to what extent capital controls and limits to movements within accounts can affect the ability of local players to trade on the stock exchange,” Ilias Lekkos, chief economist at Piraeus Bank SA in Athens, said in a phone interview today. “If there is very little volume on the exchange, then the price-discovery mechanism and the ability of prices to reflect the current macro situation will be severely impaired.”
The Cyprus General Market Index has declined 13 percent this year, according to data compiled by Bloomberg. The gauge has slumped 98 percent from its October 2007 high, compared with a 24 percent drop in the Stoxx Europe 60 Index.
Hellenic Bank, the island nation’s third-largest lender, slid 20 percent to 13.4 euro cents. The company sold its Greek units to Piraeus Bank last month.
Bank of Cyprus Plc and Cyprus Popular Bank, the nation’s biggest banks, account for 60 percent of the benchmark index’s weighting, data compiled by Bloomberg show. Both companies will remain suspended from trading until April 15, according to statement on the Cyprus Stock Exchange’s website today.
Louis plunged 18 percent to 1.4 euro cents. Shares in the tourism company peaked at 6.15 euros in November 1999, according to data compiled by Bloomberg.
Logicom, a wholesaler of computer parts, fell 10 percent to 25.2 euro cents.
The country’s central bank today eased the limit of financial transactions to be carried out without regulatory approval to 25,000 euros from 5,000 euros previously, according to an official who asked not to be identified.
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