Following yesterday’s unprecedented decline in the US stock markets, a similar situation is likely anticipated for the domestic market, which reacted somewhat preemptively to the news of Lehman Brothers’ bankruptcy and the forced sale of Morgan Stanley.
Although the Zagreb Stock Exchange followed global trends with a significant index drop of 2.72 percent yesterday, a similar situation can be expected today. Jurica Gregurić, a member of the Management Board of Fima FAS, believes that yesterday’s events have already reflected on the Croatian market. – It was evident that things would be lively on Sunday when Lehman was desperately seeking a buyer in an attempt to avoid bankruptcy. By Monday morning, it was already known that Asian indices were recording declines of four percent or more, prompting domestic investors to react accordingly – says Gregurić for Lider, adding that the magnitude of the events that occurred must be taken into account. Namely, one of the largest investment banks filed for bankruptcy, another (Morgan Stanley) was sold under duress, and on the same day, the world’s largest insurer announced the need for urgent financing. This morning, European indices have again started to decline, already by almost two percent, indicating that the domestic capital market is also facing challenges. (Amir Kulenović)
