Stocks report: PKN drags the market down

It lost nine percent after it posted a profit of zł.314 million, much lower than a year before. Its stock hit new lows in the days after the results release.

Another factor causing stock-market weakness was the interest-rate decision in Europe. The ECB made a second hike this year and left a positive outlook for further hikes. This makes yields in Poland less attractive for international capital and caused a slight sell-off in debt and currency markets.

The WIG20 fell more than 100 points last week and the charts show for the second time in the last months a major resistance at the 2,950-points level. For the second time testing that level resulted in a sell-off and a slow recovery thereafter. If bears succeed in breaking 2,800 points, we would be able to talk about a change in the trend. The potential risk factors in the coming days are the BPH-Pekao SA merger, EU Commission lawsuits against Poland, and the zloty, which after breaking above zł.3.80 against the euro could widen losses for foreign investors that came to the Polish market this year.

Disappointing results from Netia and Softbank worsened sentiment for stocks and Friday saw all WIG20 members' quotations slip into red.

Adam Łaganowski,

WGI Dom Maklerski