National Bank of Greece (ADR) (NYSE:NBG) has been crashing down like a rock for a long time now and any bounce or rally seen were just short coverings or some failed bottom fishing efforts. The entire Greek economy is in the doldrums and that state is adequately reflected in the health of this bank. Yesterday the bank lost 9.32% with the volume surging to about 39 million against the daily average of 9 million. This selloff came on the back of the public entities of Greece being ordered by the government to provide cash cushion to the eroding reserve of the central bank. The government declaration last Monday was an alarming signal of how deep the country’s reserves dried up and that was not very soothing to the investors.
The Greek bonds have seen a very sharp selloff in the last few days and the yields on the short term bonds reached a 3 year high. The yield of the 2017 bonds registered a life time high of 27%. As the Greek exit from the Eurozone approaches closer, the crisis deepens for National Bank of Greece (ADR) (NYSE:NBG) too. The deteriorating net income, the feeble growth in earnings per share and the disappointing return on equity bears witness to that fact.
The technical state of the stock is nothing but bearish and has remained in that condition for a long time now. For more than a decade, the level of $100 was the lowest point for the stock but once that was broken in 2010, it descended to the incredibly low $1 level fast enough. There is no sign of any possible reversal yet and the latest selloff volume just indicates more downside can’t be ruled out. Only aggressive investors, who would like to bet on some kind of bailout for the country, can attempt absolutely high risk bottom fishing.
