Negative sentiment among investors was reflected in the Polish currency. Obviously, the value of the zloty is falling. On Tuesday after 5 p.m., the US dollar cost about PLN 4.10. While the exchange rate in the morning was PLN 4.05. This means that the Polish zloty weakened against the dollar by about 1.2%. A deeper depreciation of the Polish currency can be seen in the long term – on April 10, the USD/PLN exchange rate was PLN 3.92. This is clearly a continuation of a trend that began before the weekend – even before the disturbing reports emerged from Israel.
A similar trend can be observed in the case of the euro. common The European currency was valued at PLN 4.36 on Tuesday after 5pm, a 1.3 percent decline. Compared to the morning rate of less than PLN 4.31.
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Warsaw Stock Exchange is in the red zone
The declines also affected the Warsaw Stock Exchange. Most companies included in the WIG20 index ended Tuesday's session with a negative result, and in the case of some important entities, losses exceeded 4%. Companies with the deepest declines included: KGHM (-4.79%), PKN Orlen (-4.67%), JSW (-4.65%), PKO BP (-4.30%), Kruk (-4.28%), LPP (-4.23%) . ) and Picao (-3.35%).
Other companies also recorded declines, but they were slightly lower – about 1-2%. However, only four companies listed on the Warsaw Stock Exchange ended the day in positive territory. The selling gained momentum relatively late, only after 15:00.
Were investors afraid?
Escalation of the conflict in the Middle East could have far-reaching consequences for the global economy and financial markets. As Kostecki notes, The potential deterioration of the situation could “upside down” the current expectations of analysts and investors. In the face of increasing uncertainty, market participants are currently being extremely cautious, which is translating into declines in stock prices and weakness in emerging market currencies, including the Polish zloty.
XTB's Tymoteusz Turski confirmed in his afternoon commentary what was already visible in the morning – At the moment, investors are not seeing any reassuring signs. “Israel, despite pressure from its allies, including the United States, to calm the conflict, announces retaliation for the Iranian air attack. Faced with a vision of a deepening war, markets are reacting with price cuts, which are currently visible across the European market,” he is writing.
Defense companies benefit
As the analyst confirms, the German DAX index continued to decline an hour before closing time, despite positive data from the ZEW Sentiment Index on the British Stock Exchange, where the FTSE 100 index fell by approximately -1.4%. The WIG20 remains the European leader in declines with a discount of approximately -2.8 percent
“Only some companies stand out favorably on the Old Continent, including: from the defense sector. Italian helicopter manufacturer Leonardo is gaining 1.37%, and German laser communications systems manufacturer Mynaric is growing nearly 3% today. The further direction of price movements is difficult to predict, but rising geopolitical tensions provide an interesting basis for potential increases in the defense sector,” concludes the XTB analyst.
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