The significant lead of the sovereigntist candidate George Simion in the first round of the presidential elections is causing the first negative consequences for Romania in the financial markets.
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- Bucharest sector won by Simion
- Which are the localities in Ilfov where Nicușor Dan won
- County where Crin Antonescu won with 74.62%
The considerable advance of an isolationist politician in the first round of the presidential election is interpreted by financial actors as a major risk to Romania's economic stability. Consequently, the markets reacted negatively from the early hours of Monday.
Here are the first shock waves that the first-round election result has caused in the economic realm:
- Bucharest Stock Exchange opened in the red on Monday, down by 2.5%, amid a decline in some of Romania's most important stocks.
- The BET index dropped again below the 17,000 points level, as reported by Profit.ro.
- At 10:10, the shares of Banca Transilvania, the largest bank in Romania, fell by 3%. Romgaz lost 5%, while OMV Petrom lost 2%. Hidroelectrica shares, the largest energy producer in the country, dropped by 1%, according to data analyzed by Ziarul Financiar. This is happening as approximately 8.2 million Romanian employees are indirectly the largest investors in listed companies through private pension funds in Pillar II.
- Transactions in the first minutes reached 13 million lei in the stock segment, but increased activity can also be seen in the bond segment, where liquidity amounts to 5.2 million lei. Brokers mention that there are buyers in the market, but some sales are made at "bid" prices, without waiting for a potential balance between supply and demand.
- The state borrowing costs have reached 7.75%, up from 7.47% at the close of Friday's session.
- The yield of the 2034 maturity bonds increased by 20 basis points, from 7.53% on Friday to 7.73% on Monday morning. The higher the yield in secondary market transactions, the higher the interest rates investors will demand in the state's bond issuances (primary market). The situation could change during the day, especially if traded bond volumes increase, as noted by Profit.ro.
- Romania has a negative outlook from the three main financial rating agencies (Fitch, S&P, and Moody's), indicating the risk of a deterioration in the state's financial situation in the absence of stabilization measures, as well as the possibility of being downgraded out of the recommended category for investors. The next rating evaluation is scheduled for the end of summer.
Experts anticipate a period marked by volatility in the context of the political situation in our country.
"I believe there will be market volatility in the next two weeks due to extremely high uncertainty. The possibility of Romania shifting towards euroscepticism will not be well received by foreign investors and Romania's financiers. According to rating agencies, what keeps us in the investment-recommended category is precisely our EU membership and European funds," said Adrian Codirlaşu, President of CFA Romania and lecturer at ASE, for ZF.