Stocks report: Retracing losses

The media, food and construction sectors were top picks, while banks, developers and telecoms weighed negatively on the WIG20. I think that the Polish Monetary Policy Council is partially responsible for the weaker performance of those stocks, as they decided to hike the key interest rate by another 25 basis points.

Such a move was widely expected, of course, as some of the Council members had already voted for a hike in October, albeit unsuccessfully. Higher rates could negatively affect certain businesses and that's why investors decided to sell some of stocks.

Most companies retraced the recent notable sell off, and I expect more selling pressure on higher levels. In the longer term I think that risk for stocks is relatively high, as the mood among investors is still optimistic. This mood needs to be just the opposite in order to start a long-term and broad upturn.

Tomasz Jerzyk, technical analyst DM BZ WBK SA