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Tuesday November 20 2007

Standard &Poor's change the outlook for Iceland sovereign to negative
The ISK has fallen 1,87% today (14:00) pushing  the ISK TW index up to 121.7 points, its highest level in two months. The fall is fuelled by Standard & Poor's decision to change the outlook for Iceland's sovereign to negative from stable. The S&P decisions was announced earlier today.  According to Standards & Poor's the revision reflects the increasing risks of a hard lending in the Icelandic economy. The credit rating of Iceland's sovereign however remains unchanged.  The S&P ratings for Iceland's sovereign are 'A+/A-1' foreign currency and 'AA/A-1+' local currency.

Nordic shares: still scope for a rise despite wider fluctuations
Glitnir Research has issued a report on Nordic shares.

Glitnir Research sees a continued upward trend in Nordic equity markets, marked by increased volatility. Global economic growth is still strong historically, but growth among industrialised countries can be expected to slow from recent quarters. Growth in emerging markets remains robust. China pulls the wagon but other emerging economies such as India, Brazil and Russia follow closely behind.

Despite the turmoil on global markets recently, the market sentiment has been evidently solid in the Nordic area, supported by strong expected earnings growth. The current credit market problems can be expected to pose a risk to the market sentiment in the Nordic area in coming months as elsewhere, but the impact on specific sectors will vary. Glitnir Research therefore recommends that investors choose their investment options prudently and especially recommends the oil sector along with the IT and telecom sectors.

Nordic Equity Strategy Report

The OMXI15 slumps below 7,000 points
The stock market opened with a commotion this morning, and the OMXI15 share index sank by almost 2%. The dip has only partially been reversed and at the time of writing (14:21) the OMXI15 has fallen 1.08% today. The index now stands at 6,888 points. The S&P decision to change the outlook for Iceland sovereign from stable to negative along with spill-over effects from foreign markets are the cause for the adverse market sentiment in the Icelandic market. Yesterday,  the OMXI15 share index slumped below 7,000 points in a sharp dip which saw Icelandic stocks fall 3.65% within the day in the second largest fall in a day this year and the sixth deepest within the day since the year 2000.

When the stock market peaked this summer, the OMXI15 exceeded 9,000 points, having surged by 40% from the beginning of the year. However, that rise has now largely been reversed and the rise this year to date is now around 9.4%.  

The OMXI15 slumps below 7,000 points
Standard &Poor's change the outlook for Iceland sovereign to negative
Nordic shares: still scope for a rise despite wider fluctuations
ISK-Eurobond maturities in November
Another slack quarter for Icelandic
The listing of Skipti delayed until next year
Retails sales turnover in October
Date: 11/20/2007
Category Volume
Benchmark Bonds 615,595
Equities 55,337
Other Bonds 50,881
Total 721,814
Date: 11/19/2007
Largest turnover  
ID Vol. Price Price ch.
GLB 2,575 24.90 -3.11%
KAUP 1,786 916.00 -4.38%
FL 1,325 21.60 -3.14%
STRB 1,280 16.05 -5.31%
LAIS 998 38.00 -2.56%
Date: 11/19/2007
ICEX-15 6,956 -3.65%
Date: 11/19/2007
Benchmark Bond Issues  
ID Vol. Yield
HFF150224 58,429 6.46% 0.03
HFF150434 102,612 5.32% -0.02
HFF150644 213,239 5.01% 0.01
HFF150914 102,806 7.48% -0.10
RIKB 08 0613 5,796 14.30% 0.00
RIKB 08 1212 45,084 14.21% -0.04
RIKB 09 0612 0 14.08% 0.01
RIKB 10 0317 65,779 12.78% -0.10
RIKB 13 0517 72,730 10.44% -0.09
RIKS 15 1001 0 %
Date: 11/19/2007
REIBOR Market  
O/N 13.28% 13.53%
SW 13.74% 13.99%
1M 13.88% 14.13%
3M 14.00% 14.25%
6M 14.20% 14.45%
12M 14.20% 14.45%
Date: 11/19/2007
Exchange Rates  
  pr. ISK 3m.Libor 3m.fwd.
USD 62.43 5.00% 1.4
GBP 129.01 6.49% 2.4
JPY 0.57 0.92% 0.0
EUR 92.44 4.63% 2.2
Vt. ISK 121.90 4.89% 2.8
Date: 11/20/2007 14:46 GMT
Volume in ISK m. 

This report is provided for information purposes only. It should not be considered a solicitation to buy or an offer to sell any security. All views and analyses are those of Glitnir Research at the time of writing, and can change at any time without notice. Neither Glitnir nor its personnel can be held responsible for transactions carried out based on the information and opinions expressed here. Readers are urged to seek expert advice when taking decisions on market investments.

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