Poland says Russian drones shot down. Stocks in Warsaw fell, the zloty became cheaper

Polish stocks and the zloty declined in trading on Wednesday, the biggest drop in two weeks. Warsaw said it shot down Russian drones that flew into its airspace.

Poland's main stock index WIG20 was falling by 2.6% during trading in Warsaw. This is its biggest decline over the past two weeks, it turned out to be the worst in terms of dynamics among the world's major stock indices, Bloomberg reported. Among the leaders in the rate of decline were one of the largest retail banks in Poland Alior Bank and the owner of a chain of discount stores in Central and Eastern Europe Pepco Group: their shares on Wednesday were losing at least 3%. The fall of the national currency, the zloty, reached 0.5% against the euro, the agency writes.

At the same time, the WIG20 is showing generally good dynamics this year: it has grown by more than 20% since the beginning of the year. This is about twice as much as the main U.S. index S&P 500. However, in recent weeks, investor sentiment has deteriorated due to plans to raise the tax on banks, notes Bloomberg.

"I see the current drop in quotations as a temporary reaction to geopolitical risks. The authorities want to demonstrate decisive actions, hence the decisions that cause a strong reaction of the markets," Andrzej Bieniek, investment director of Warsaw-based fund Esaliens TFI, said in the agency's statement.

Poland has said it shot down Russian drones that Warsaw says crossed its border during a Russian attack on Ukraine, calling the incident an "act of aggression." Prime Minister Donald Tusk said the country had asked NATO to invoke Article 4 to consult on a possible military response.

"There is no reason to declare that we are now at war. However, there is no doubt that this provocation goes beyond previous ones and is incomparably more dangerous for Poland than all previous ones," Tusk said.

This is the first time since the start of the full-scale conflict between Russia and Ukraine in February 2022 that a NATO member country has shot down a military aircraft that flew into its airspace, Bloomberg added.

The Kremlin declined to comment on Warsaw's statements. There have been no requests from the Polish leadership for any contacts, Moscow claims.

This article was AI-translated and verified by a human editor