The Prague PX index fell by more than two percent on Monday around 5.30 pm Central European Time. The highest losses on the Prague Stock Exchange are recorded by banks led by Erste Bank, which depreciated more than nine percent at the same time. Komerční banka lost over two percent, as did Moneta Money Bank.
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On the contrary Czech Zbrojovka adds almost 11 percent. Shares of the technology company Avast also opposed the trend, improving by more than 1.5 percent. The PX index weakened significantly last Thursday after the start of the Russian invasion of Ukraine, while on Friday it rose. Monday’s losses are the result of anti-Russian sanctions in Western countries.
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“The Prague Stock Exchange has another hectic day behind, when investors reflected global sentiment in the context of the weekend development of events around Ukraine,” said Fio bank broker David Brzek. The stock market fell by more than three percent during the day, but gradually wiped out some of the losses.
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The entire financial sector ended in red. “Although the banks traded on the Prague Stock Exchange have virtually no exposure to Russia and Ukraine, they have experienced negative sentiment,” said Brzek.
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European shares also started trading on Monday, with banks with ties to Russia losing the most, especially Austria’s Raiffeisen Bank, Italy’s UniCredit and France’s Société Générale.
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Shares of European banks depreciated from six to sixteen percent. The euro area sub-index then lost more than five percent. Shares of Renault, which is controlled by Russian carmaker Avtovaz, have blushed by about seven percent on the Paris Stock Exchange.
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The Moscow Stock Exchange remained closed
Russia’s stock market remained closed on Monday. Russia’s central bank first announced in the morning that trading would begin later. But this plan fell through.
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There was also no trading on the financial derivatives market. The central bank thus decided to prevent further damage following the introduction of severe Western sanctions, which led to collapse ruble and paralyzed the Russian economy. The Kremlin subsequently announced that it was preparing retaliatory measures for sanctions paralyzing air traffic in Russia.
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The European Union and some other states agreed over severe sanctions against Russia over the weekend for its invasion of Ukraine. The most serious ones concern the disconnection of most Russian banks from the global payment system SWIFT, which prevents banks from conducting transactions with foreign countries.
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The market’s nervousness is also heightened by Sunday’s announcement that Russian President Vladimir Putin has ordered nuclear forces to be on high alert due to aggressive statements by NATO member states.
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