ZF Today’s opening at the Stock Exchange. Alexandru Angelo, BVB investor: It is necessary…

♦ In Europe, energy companies are trading up 10% this year through the Stoxx 600 Energy index ♦ At BVB, the dynamics of BET-NG is below that displayed by BET.

During the April 24th edition of the ZF Deschiderea de Otaje show, Alexandru Angelo, investor at the Bucharest Stock Exchange, was invited, who discussed the potential presented by the main energy companies from the BSE in the face of the pace of price growth, having considering that inflation could accompany a potential return or acceleration of the economy; In this regard, the investor cites the dynamics of the PMI index (Purchasing Manager’s Index), which reflects the evolution of the manufacturing industry.

“I have a diversified portfolio and I think it is necessary to focus on the energy sector as well. The “magnificent four” from BVB – allusion to the “magnificents” on Wall Street -, i.e. Hidroelectrica, Nuclearelectrica, Romgaz and Petrom, the largest local energy producers, will help us to successfully overcome moments of uncertainty and inflation” , considers Alexandru Angelo.

On the local stock exchange, the BET-NG index – which includes companies on the main market whose business is energy and related utilities – shows an advance of 7.7% since the beginning of the year, compared to 10% on the BET benchmark.

The dynamics of the last 12 months are 26.7% and 36%, respectively. In Europe, the Stoxx 600 Energy index is on the rise by 10.2% in 2024, its structure includes companies such as the British groups Shell and BP, as well as the French giant TotalEnergies. The Stoxx 600 is up 6.3% this year.

“I include the PMI indicator in my investment decisions and consider it quite important in terms of portfolio allocation. If we look at this graph, we notice that, in the United States, for example, we are witnessing a strong return of the manufacturing sector. For several months we have been recording values ​​above 50, which indicates a first expansion of the sector from the fall of 2022 – obviously with a few failed attempts in 2023, which turned out to be rather stagnant.”

But what is the connection between the energy sector, inflation and the PMI indicator?

“In the current context, I believe that any return or economic re-acceleration will be accompanied by inflation. When we talk about a recovery in the manufacturing sector, we are mainly talking about an increase in demand for tangible goods and, implicitly, a higher consumption of energy”, says the investor.