A sudden realization that oil prices had fallen sharply seemed to scare investors away from the Oslo Stock Exchange when trading got underway this week. On Tuesday they were back, and a recovery seemed to be underway, but it didn’t last and the market was down again on Wednesday morning.
Several of the biggest companies traded on the Oslo exchange logged gains in afternoon trading, and the exchange’s main index looked set to rise as much as 2 percent. It ended the day virtually unchanged, though, with investors largely failing to recoup Monday’s losses.
Oslo shares tumbled nearly 4 percent on Monday, with the index falling back under 270 for the first time since early May. In June it had been up over 300. Investors woke up to the fact Monday that oil prices had fallen USD 10 in less than a week, and a drop in oil prices always hits Norwegian shares hard. On Wednesday the price of North Sea crude was down below USD 63 a barrel, less than half its level last year.
The country’s biggest company, state-controlled oil and gas concern StatoilHydro, fell 4.5 percent on Monday to NOK 120.20 per share. On Tuesday it was up again, to NOK 121.46 shortly after 4pm, ending the day at NOK 121.20.
Other large companies were also among the biggest losers on Monday, and some kept losing on Tuesday. Norsk Hydro, suffering from low prices for its major product, aluminum, lost 5.7 percent to close at NOK 29.70 on Monday and it remained unattractive to investors on Tuesday, while Yara and Seadrill bounced back. Yara ended the day up 6 percent to close at NOK 172.25.
Trading started poorly on Wednesday, with the exchange’s index down to 268. Oil prices dipped again, to USD 62.60. Norway’s currency has weakened in recent days as well, and it now takes around NOK 6.50 to buy one US dollar.