Fundamental and Technical Analysis of 5 Sectors

.Macroeconomic context

In 2010 the economy of Roumania was widely believed to start recovering, yet slowly and not all of the massive drawbacks could be overcame in 2010. Especially the Romanian labor market remained in a bad shape.

The former level of unemployment in Roumania of just some 4.4% is not expected to be reached again before 2014, though a first decrease of 1.4% to 6.2% was expected for 2010. Real wages in Romania experienced a negative growth -2.3% though average gross salaries grew by some 5%. However, the times of double digit growth rates seem to be gone for the next few years when it comes to salaries in Romania.

As for the fiscal framework for 2011-2012 period Government has commited to narrow the general budget deficit from 6,8% in 2010,to 4,4% in 2011,3,0% in 2012 and 2,5% in 2013.

The GDP of Romania (per Capita) is among the lowest of the EU, second only to Bulgaria.

Romania's budget deficit was 6.6 percent of gross domestic product at the end of 2010, a touch below the 6.8 percent IMF-agreed target, newspaper Ziarul Financiar reported.

The deficit was 5.2 percent of GDP in January-November.

"The preliminary 2010 budget deficit was about 6.58 percent of GDP, under the IMF target," Ziarul Financiar quoted govenment sources as saying. (Reporting by Ioana Patran, Editing by Radu Marinas and Neil Fullick)

Main contributors to GDP growth in Romania have been exports and internal demand, broadly financed by external debt. FDI contributed further and altered the GDP structure and composition..

In 2011 the GDP is expected to raise from 0,5% to 2,4%,but it isn’t a sure prediction in this period,many expecting the crisis to extend in 2011 also.

Inflation was mainly caused by the Romanian’s incapability to collect taxes (and, hence, financing their immense current spending) and a protective exchange rate regime. Yet, inflation in Romania is still on the very high side of the EU.

Main drivers for inflation in recent years may be described as a kind of Balassa-Samuelson effect as prices tend to grow faster than productivity levels.

A current forecast by the CNP sees Inflation in Romania for the next years as follows:

Table: Inflation Rate – Forecast 2008 – 2014

Inflation Rate / Year 2008 2009 2010 2011 2012 2013 2014

Romania 6.3 4.5 3.5 3.2 2.6 2.3 2

It remains to be seen if these figures will be met. In the past Romania rather used to fail inflation targets.

***Bad influences***

The first bad influence for Roumanian economy is the problem of the high degree of corruption.Many foreign people complain about it and how many difficulties they had to face while trying to have a business here.It is corruption that changed the mind of a lot of important investors to come and start a business in Roumania,and it is the corruption that made them go.

The interest rate,commonly banded about by the media,has a wide and varied impact upon the roumanian economy.In some cases raised and the general effect is to lessen the amount of money in circulation,which works keeping inflation low.It is also makes borrowing money more expensive,which affects how roumanian consumers and business spend their money:

-this increases expenses for companies

-lowering earnings somewhat for those with debt to pay.

Clearly the changes in Roumanian laws affect the behavior of consumers and business,but Stock Market is also affected.

The price fluctuates as a result of the different expectations that people have about the company at different times and of course because of the increase or decrease in the powering power.

Finally it tends to make Roumanian STOCK MARKET a slightly less attractive place to investment so this year we’ll find BVB with a low growth but promising for the next few years.

***Good expectations***

For 2011 will find about property fund(FP) that will be listed at BVB on January 25,2011,estimates the administrator of fund,investment company Franklin Templeton.

Frsnklin Templeton the took the administration of FP on September 29,2010,the fund being created on December 2005 for compensation to persons deprived of property abuse by communist regime.

On Octomber 31,2010,the fund net assets was 13,5 billion lei,and the net per share was 0,9792 lei.In the portofolio,the shares had a point of 88,7% and 10,6% of bank deposits.