Due to Russia’s Attack, All Global Stock Markets Under Strong Pressure, ZSE Follows Trend

On European stock exchanges on Thursday morning, stock prices sharply fell as investors are reluctant to engage in riskier investments after Russia attacked Ukraine, which could negatively impact the global economy. The STOXX 600 index of leading European stocks was down 3 percent at 9:30 AM.

Meanwhile, the London FTSE index fell 2.47 percent to 7,312 points, while the Frankfurt DAX plummeted 3.65 percent to 14,095 points, and the Paris CAC dropped 3.12 percent to 6,569 points.

On the other hand, oil prices surged, with the price of a barrel on the London market, for the first time in over seven years, breaking above the psychologically important level of 100 dollars.

Traders fear that Russia’s attack on Ukraine will disrupt the supply of oil and gas from Russia to global markets and that rising energy prices could further fuel already high inflation, negatively affecting the recovery of economies from the coronavirus crisis.

– Markets now realize that Russia will do whatever it wants, given the weak sanctions, and the invasion of Ukraine is now factored into prices. Investors fear that Europe will be cut off from Russian gas, that the EU cannot cope with such a shock in supply, and that it will have to curb demand, which would be economically exhausting. Higher energy prices could jeopardize the growth of the global economy, which is bad for riskier investments – says Ray Attrill, strategist at National Australia Bank.

Following the news of the attack on Ukraine, oil prices rose sharply. The price of a barrel on the London market jumped 3.5 percent, breaking above the psychologically important level of 100 dollars for the first time since September 2014.

In the American market, however, the price of a barrel increased by 4.5 percent to 96.20 dollars.

Wall Street Sharply Falls Again

On Wall Street, stock prices sharply fell for the second consecutive day. The Dow Jones dropped 464 points or 1.38 percent to 33,131 points, while the S&P 500 plummeted 1.84 percent to 4,225 points, and the Nasdaq index fell 2.57 percent to 13,037 points.

Dollar Strengthens, Gold Price Rises.

In the currency markets, the value of the dollar against a basket of currencies increased, and the Japanese yen also strengthened as investors seek safer havens for capital in uncertain times.

The dollar index, which shows the value of the US dollar against the other six major world currencies, is around 96.70 points this morning, while it was 96.05 points at the same time yesterday.

Meanwhile, the exchange rate of the dollar against the Japanese currency slid from yesterday’s 115.05 to 114.70 yen.

However, the US currency strengthened against the European currency, causing the price of the euro to fall to 1.1225 dollars, down from 1.1330 dollars at the same time yesterday.

As investors move away from riskier investments, the price of an ounce of gold also significantly rose by 1.2 percent to 1,930 dollars, the highest level since January last year.

„Markets are now pricing in the risk that something terrible will happen. And this, combined with uncertainty, creates a dreadful environment where no one wants to be overly exposed to riskier investments,” says Rob Carnell, director at ING.

Asian Markets

Asian stock prices also sharply fell, with the MSCI index of Asia-Pacific stocks, excluding Japan, down 3.4 percent around 9:30 AM.

Stock indices in Japan, Shanghai, South Korea, Australia, and Hong Kong fell between 1.7 and 3.2 percent, while trading is closed in Japan due to a holiday.

ZSE: Crobex Indices Follow Sharp Decline of Global Stock Indices

On the Zagreb Stock Exchange on Thursday morning, Crobex indices fell more than 2 percent, following all major global stock indices, which are under pressure due to Russia’s attack on Ukraine.

The Crobex index was down 2.75 percent at 10:00 AM, at 2,061 points, while Crobex10 plummeted 3.06 percent to 1,245 points. Regular trading volume in shares reached around 2.6 million kuna by 10:00 AM, significantly higher than usual at this time. This morning, all sector indices were in the red as the prices of nearly all 20 shares traded fell.

The largest declines were seen in the shares of AD Plastik, Atlantska Plovidba, and Dalekovod, which fell more than 10 percent. The price of Atlantic Grupa shares also sharply dropped by more than 9 percent, although the company reported this morning that it achieved a growth in net profit and record sales revenue of 5.7 billion kuna last year, which is 8.6 percent higher than in 2020.

Thus, Crobex indices follow the decline of global stock indices, which are under pressure due to Russia’s attack on Ukraine.