As we reported earlier, the European Commission announced on Tuesday that it is launching the rule of law procedure against Hungary. When President Ursula von der Leyen made this announcement, the stock market in Hungary plunged, weakening the forint from its 370 value against the euro to 377.
This article was originally published on our sister-site, Ungarn Heute.
After the European authority continued to express its concerns about Hungary and Poland, especially with regard to the independence of the judiciary and corruption, the financial market reacted quickly: the Hungarian stock market began to fall, and the forint weakened.
The BUX stood at 44,849 points at 3:30 p.m. and fell to 43,727 points at 4:30 p.m. – it was down 4.11 percent Tuesday afternoon.
The stock market was not in good form from the outset on Tuesday, and fell further after the announcement. On the Hungarian stock exchange, investors mainly sold their OTP securities, and the major bank lost 5.4 percent by 4:30 p.m.
The stock index of the Budapest Stock Exchange, the BUX, finally closed on Tuesday with a minus of 3.55 percent or 1610.52 points at 43,787 points.
Not only did share prices fall following the news of the EU proceedings, but the forint also weakened. After the announcement, it dropped to almost 377 against the euro – down 2.2 percent from yesterday’s close – and then corrected back to 375. After the close, the dollar was trading above 343 forints, the pound at 450, and the Swiss franc at 369.6.
In conclusion, the forint weakened from 370 (Tuesday morning) to 377 (Tuesday evening) and was still at this level on Wednesday morning.
Featured image via Márton Mónus/MTI