Cookie Consent by Free Privacy Policy Generator
6.6 C
Oslo
Thursday, March 28, 2024

Stocks and oil fund take further hit

The Oslo Stock Exchange (OSE) fell to a new low for the year on Friday despite promising unemployment figures from the USA, while the country’s sovereign wealth fund (often referred to as the “oil fund”) also suffered from the difficult international financial environment.

The OSE ended Friday’s trading down 2.75 percent on 365.03 points, meaning it had fallen 14.5 percent in the last nine days alone. On Wednesday, the index fell below 400 for the first time since December 2010. This week has been the worst for the stock exchange since the financial crisis.

When US unemployment levels were disclosed to have risen by 117,000 in July – better than predicted – the world markets initially improved. Finance newspaper Dagens Næringsliv reported that the OSE began to show a small 0.5 percent increase at that point, but fell again later in the afternoon when analysts began to interpret the figures from the US more negatively.

Meanwhile, newspaper Aftenposten revealed that the Norwegian sovereign wealth fund, known officially as the “Government Pension Fund – Global” and unofficially as the “oil fund,” fell by more than NOK 1 billion (USD 182 million) in the last quarter, dipping below NOK 3,000 billion (USD 546 billion) as a result of the recent downturn in world markets. The fund had NOK 3,102 billion at the start of the previous quarter, having gone over NOK 3,000 billion in the autumn of 2010, but was estimated to stand at NOK 2,998 billion on Friday. The fund was named as the biggest of its kind in the world earlier this year.

The bad news for the fund came in the same week that it was revealed by Dagens Næringsliv that NOK 245 million (USD 45 million) of fund money had been invested in further new properties in London. Up to 5 percent of the fund can be used to buy property as part of a risk-spreading strategy. The fund’s first foray into the property market also came in London, where a 25 percent share was purchased in the famous shopping area of Regent Street last year, after which the fund also paid billions of kroner for property in Paris. One of the newly bought properties lies beside Regent Street, and includes shops and the Greek tourist information office.

Views and News from Norway/Aled-Dilwyn Fisher
Join our Readers’ Forum or comment below.

To support our news service, please click the “Donate” button now.

LATEST STORIES

FOR THE RECORD

For more news on Arctic developments.

MOST READ THIS WEEK

Donate

If you like what we’re doing, please consider a donation. It’s easy using PayPal, or our Norway bank account. READ MORE