The Spanish stock market has exhausted the bullish inertia with which it closed 2023 and started the year. The Ibex 35 lost 2.1% in its worst week since October and led the cuts in the European stock market, weighed down by the evolution of Iberdrola, Cellnex and the banking sector. The selection saw how in just over a week it went from touching 10,200 points to losing 9,900 and leading the declines of the European stock market in the weekly balance sheet.
“The mood at the beginning of the year is a bit low, but despite this the market declines are not as pronounced as one would expect,” acknowledges Diego Fernández, investment director at A&G. The expert believes, in statements to Bloomberg, that there are still “excesses from last year that need to be eliminated, as expectations of rate cuts had gone too far. “We remain cautious with stocks.”
Doubts that are also reflected in the evolution of the rest of the European markets, with cuts ranging between 1.2% of the Cac 40 and 0.7% of the Euro Stoxx 50, but softer than the Ibex. On the Spanish stock market, companies related to clean energy have been the most penalized this week and are far from finding ground. Solaria cuts 13.2%, while Acciona drops 11.6% and its green subsidiary drops another 7.9%. In the case of Solaria, Citi analysts lowered their recommendation from buy to neutral given the reduction in their ebitda estimates. They believe the company is too exposed to energy prices. They also reduced the indicative price from 17 euros per share to 15.5.
Rovi, for his part, stands out in the opposite camp. The company gained 4.28% in the week, followed by Meliá, with an increase of 4.17%, driven by the good prospects for the tourism sector this year after a 2023 in which Spain managed to set a record of foreign tourist arrivals, exceeding 84 million.
In the debt market, bond yields end the week with slight increases. The yield on the 10-year Spanish bond rises to 3.24%, that of the German bond maturing in 2034 stands at 2.34% and the yield on the American bond of the same duration exceeds 4.17%.
From Link Gestión they estimate that investors are starting to assimilate the fact that central banks, even if they will lower their reference rates this year, will start to do so later and, probably, to a lesser extent than what the markets have discounted until a short time ago. . The president of the European Central Bank (ECB), Christine Lagarde, recently indicated June as the probable date for the start of the decline in rates.
Looking ahead to next week, investors await fourth-quarter US GDP data and the start of earnings season in Spain, with Bankinter kicking off proceedings next Thursday. For experts at Bank of America, the next rally or adjustment in the markets will require data to erase rumors about the hard landing of the US economy.
Yves Bonzon, CIO of Julius Baer, reminds that the main risk “lies in an unexpected acceleration of growth that would trigger a retreat by the Fed or even the ECB in terms of ceasing to cut interest rates to less restrictive levels ”.
For his part, the chief strategist of Bank of America, Michael Hartnett, estimates that as long as the yield on 10-year US bonds remains between 3.75% and 4.25%, investors will once again avoid banks, Socimi, small capitalization and the most indebted companies.
With geopolitical risk increasing due to the crisis in the Gulf of Aden which risks damaging world trade, a barrel of Brent oil is around 78 euros. From Allianz Global Investors, its Global Director Multi-Asset Investments highlights that the main concern for the markets and the biggest catalyst for
oil is that the conflict will extend to the Strait of Hormuz, through which a fifth of the volume of barrels consumed worldwide passes every day.
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STOCK STOCK – CURRENCIES – DEBT – INTEREST RATES – RAW MATERIALS
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2024-01-19 16:43:18
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