The sales of shares were so aggressive that 12 of the 16 stocks part of the BET index triggered the volatility interruption mechanism.
“I’ve never seen this mechanism applied to other stocks,” a broker says.
Dragos Mesaros, trading manager with Goldring, says investors traded in a panic.
“Maybe they should reconsider over the next few days. I expect the dust to settle.”
With all stock market indicators in the red on Monday, having dropped 7% to 8%, some investors took advantage of the low stock prices, driving the trading volume to about RON140 million, much higher than the average at this time of the year.
Banca Transilvania (TLV.RO), the largest bank in Romania, accounted for 30% of the transactions but dropped 6% in price.
As if the coronavirus outbreak was not enough to shake the world’s markets, investors got a new reason to worry as of Sunday: the steepest decline of the oil price in 30 years spells out the most hectic trading sessions in recent years.
The investors were not the only ones to lose money on Monday, the future 7.4 million retirees of Romania did, too, as their pension accounts are managed by private pension funds that invest in shares. How did it come to this?
The start of the week arrived with a new blow to the already fragile stock markets, so besides the coronavirus outbreak, the investors got something else to worry about: the plummeting oil price.
There is a price war being fought on the oil market, where Saudi Arabia, abandoned by Russia and threatened by the US is using its most powerful weapons against the economies of the two world powers, its oil production and the discounted exports. Therefore the Brent oil fell 30%, which caused energy stocks to drop, as well, even in Bucharest.
OMV Petrom (SNP.RO) lost 14% or some RON3 billion of its capitalization on Monday, ZF has found. (EUR1=RON4.8184)
(English version by Loredana Fratila-Cristescu)