The Athens Stock Exchange tumbled dramatically after it was reopened on Monday following a five-week shutdown. The ASE index dropped by 23 percent while stocks of Greece’s National Bank were down 30 percent.
On June 29, the Hellenic Capital Market Committee announced the temporary closure of the country’s stock exchange. According to experts, financial markets have never been shut for such a long period before. Greek authorities imposed an extended bank holiday to prevent capital flowing out of the country through the market. However, as they realized that time alone cannot improve the current situation, it was decided to resume trading with a number of tight restrictions.
The statement issued by the country’s Ministry of Finance says that Greek traders are only allowed to buy stocks, bonds, and other financial instruments with new money transferred from abroad or received from customers including money earned from selling shares and withdrawn from investment accounts held at brokerages.
No such constraints apply to foreign investors, for whom trading rules remain unchanged, meaning they can exit the game any time.
Meanwhile, the Global X FTSE Greece 20 ETF, an index fund listed in the US and tracking shares of Greek companies, plunged by 17 percent during the last 6 days of June. After the second decline by 19 percent, the fund rose by 2.6 percent on Friday.
