Stable outlook continues

A reduction in surplus production capacity, geopolitical tensions and a rise in oil prices have been reflected in an increase in inflation expectations with yields on Portuguese 10-year treasury bonds climbing to close to 3%.

In the context of modest inflation activity, the ECB should hold monetary policy on a steady course with expectations of an end to the assets purchasing programme by Q1 of 2019.

Rating agency Moody’s has kept Portugal’s rating at Ba1 (1º speculative level), awaiting evidence of the sustainability of public finance improvements while DBRS increased the rating 1 point, to BBB (2º investment grade level).

The Portuguese stock market PSI-20 companies closed the first session of the week the same as it closed on Friday with gains. It was the fifth consecutive session of gains thanks to good share performances from the energy sector, notably Galp Energia. With eight quoted companies in bear territory and 10 in bull, the PSI-20 advanced 0.30% to 5.5,44,44 points. The decision by DBRS to raise Portugal’s rating failed to bring euphoria to the markets with analysts stating they are more focused on the results that follow.

“The markets are pretty stable, following the trend of recent sessions, with little liquidity, at a time when a string of results is leaving investors more cautious”, said Paulo Rosa from GoBulling.

Galp Energia shares forged forward by 1.85% to €16,24 as did EDP Group companies with EDP advancing 0,25% to €3,21 while its renewable arm inched 0.32% to €7.39.

In terms of losses, F.Ramada had a bad day losing 3.91% to €12.30 in a session which saw busy trading (60,000 shares), followed by Jerónimo Martins, which lost 0.88% to €11.30, and CTT whose shares fell 0.59% to €3.02.