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The Romanian stock market shows resilience ends first quarter in line with major EU markets as coronavirus pandemic intensifies

4/8/2020

  • As one of the most severe public health crisis intensified, all the main indices of the stock markets within the European Union went into the red at the end of the first quarter.
  • Radu Hanga, BVB President:
    • No country has the ability to fight simultaneously against a health crisis and an economic one. Romania's economy urgently needs stimuli and incentives to enable it to recover quickly and remain competitive. It is a historical challenge for Romania, and I think it is in everyone's best interest to come out stronger from this challenge.
    • We reassure the Government of Romania that it has a reliable partner in the Bucharest Stock Exchange, and we express our full availability to identify the best economic solutions that will make a decisive and significant contribution to improve the current economic situation and boost confidence in the measures. We think it has become obvious that we cannot talk about the economy without talking about the stock market as well.
  • Adrian Tanase, BVB CEO:
    • The Romanian stock exchange is stable and functional, offers liquidity and shows resilience. Through the stock market, the state can finance its fiscal deficit, support public investment projects and bolster the activity of companies heavily affected by the coronavirus pandemic.
    • We have managed to fulfill the fundamental role of the stock exchange, even under this exceptional situation unfolding at an international scale that resulted in bringing to a halt many economic activities, and we have offered investors the opportunity to access the liquidities invested in securities, during a period when the need for resources had increased significantly. It has been shown once again - if necessary - how important the social and economic function that the regulated stock markets perform is.  

 

All the capital markets in the European Union went deep in the negative territory at the end of the first quarter this year as the coronavirus pandemic brought to a halt the activity in many sectors of the economy. The capital markets had undergone crises in the past but the magnitude and speed of the corrections as compared to the previous highs were unprecedented. As one of the most severe public health crisis intensified, all the main indices of the stock markets within the European Union went into the red. For instance, among the main EU markets, the first quarter revealed -25% for DAX (Germany), -26% for CAC 40 (France), -27% for FTSE MIB (Italy), -29% for IBEX 35 (Spain). In Central and Eastern Europe, markets went down by 28% in Hungary and by 30% in Poland. The BET index of the Bucharest Stock Exchange (BVB) dropped by 23.6% at the end of the first quarter.

"No country has the ability to fight simultaneously against a health crisis and an economic one. Romania's economy urgently needs stimuli and incentives to enable it to recover quickly and remain competitive. It is a historical challenge for Romania, and I think it is in everyone's best interest to come out stronger from this challenge", said Radu Hanga, President of the Bucharest Stock Exchange.

"We have managed to fulfill the fundamental role of the stock exchange, even under this exceptional situation unfolding at an international scale that resulted in bringing to a halt many economic activities, and we have offered investors the opportunity to access the liquidities invested in securities, during a period when the need for resources had increased significantly. It has been shown once again - if necessary - how important the social and economic function that the regulated stock markets perform is", stated Adrian Tanase, CEO of BVB.

The capital markets were open and acted as a stabilizer in the economy in a context marked by increasing uncertainties and high volatility. That is why the Bucharest Stock Exchange shows its willingness and openness to dialogue in relation to political decision-makers.

"We reassure the Government of Romania that it has a reliable partner in the Bucharest Stock Exchange, and we express our full availability to identify the best economic solutions that will make a decisive and significant contribution to improve the current economic situation and boost confidence in the measures. We think it has become obvious that we cannot talk about the economy without talking about the stock market as well", added BVB’s President.

"The Romanian stock exchange is stable and functional, offers liquidity and shows resilience. Through the stock market, the state can finance its fiscal deficit, support public investment projects and bolster the activity of companies heavily affected by the coronavirus pandemic", concluded BVB’s CEO.

For the first quarter, the Bucharest Stock Exchange saw the average daily trading volume amount to EUR 11.5 million, while the total traded value for all the financial instruments was in excess of EUR 740 million. By the end of March, the capitalization of the Romanian companies listed on BVB amounted to RON 84 billion or EUR 17.5 billion.