The Telecompaper basket of European telecom stocks gained 0.9 percent last week (week 4). Sky (+4,6%) showed the best performance on the back of its semi-annual results and several product announcements. Investors apparently shrugged off the news of the UK regulator's decision to block the planned takeover by 21st Century Fox, on fears of Rupert Murdoch becoming too influential in the UK news business. Telia (+3,5%) also fared well, after reporting Q4 results and plans to sell its Georgian subsidiary, according Telecompaper.
Tele Columbus (-4,0%), Orange Polska (-3,9%) en Telenor (-3,8%) had the weakest performance. Tele Columbus annihilated the previous week's gain. Telenor was able to benefit from confirming earlier rumours about plans to sell central and eastern European assets.
Altice (1.2%) was subject to market rumours, claiming plans to sell Portugal Telecom to Orange (+2.8%) and Portuguese towers to Cellnex (-1.8%). However, Orange denied any interest in Portugal. TalkTalk (+1.2%) was able to recoup some of the year's earlier losses. The company decided to stop selling mobile service under its own brand and instead refer customers to O2 UK.
The weekly performance of our basket (+0.9%) was better than the Eurostoxx 50's (-0.1%). However, our basket of European telecom stocks has gained 1.2 percent year-to-date. As a result, it is underperforming the broad Eurostoxx 50 Index (+4.1% YTD). The strongest telecom stock so far is OTE (+10.6%), followed by Liberty Global (+6.6%) and Iliad (+6.5%). The weakest stocks are Telefonica DE (-4.4%), Tele2 (-5.1%) and TalkTalk (-8.0%).
