What does the Ibex 35 do?
European stock markets are tinged with red today after the sharp declines in Asian ones. The Ibex, which fell by more than 1% at the opening, moderates these declines to 0.7% and struggles to exceed 11,500 points. Hong Kong’s Hang Seng drops sharply near 3% today due to expectations that the new Trump government will include members with a hard line against China (Marco Rubio as Secretary of State, Mike Waltz as Security Advisor National, Lighthizer in Trade Policy), as well as disappointment over the latest stimulus announced by the Chinese government last Friday.
Which values rise or fall the most?
Those who rise the most:
Endesa: 1.09%
Railway: 0.36%
Banking: 0.53%
Those who fall the most:
Merlin: -5.91%
Colonial: -4.66%
Merlin Properties and Colonial are feeling the pinch of an incipient tax reform that aims to eliminate the special tax regime for these types of companies. The agreement was announced yesterday by the PSOE and Sumar, as part of the debate for the approval of the new budget. These two companies opened the trading session with declines close to 5%.
Acerinox: -2.83%
What are other stock markets doing?
The rest of the European stock markets are also trading in the negative. The German Dax lost 0.9% while the Paris Cac lost 0.8%. For its part, the FTSE in London fell by 0.6%.
In Tuesday’s session, Asian stock markets fell sharply, dragged down by Chinese markets and stocks, as investors worried about US President-elect Donald Trump’s policies, while bitcoin hit an all-time low due to betting on assets that would benefit from the new administration. The Shanghai Composite closed down 1.3%, the Hang Seng 2.8% and in Japan the Nikkei lost 0.48%.
Wall Street closed in the green on this holiday Monday in the United States, maintaining the upward trend of the New York stock market following Republican Donald Trump’s victory in the presidential election.
The selective S&P 500 rose 0.1% to 6,001 points, while the tech-heavy Nasdaq rose 0.39% to 20,015 points, both new all-time highs in both indicators. Additionally, the Dow Jones Industrial Average closed Monday up 0.69% at 44,293 points, also an all-time high.
The New York Stock Exchange thus added a new day of increases after a euphoric week with strong accumulated gains which coincided with Trump’s victory and a lowering of interest rates by the Federal Reserve.
The keys of the day
- Annual inflation in Germany stood at 2.0% in October, rising again after falling below 2% in the previous two months, to 1.6% in September and 1.9% in August. According to the Federal Statistical Office (Destatis), which confirms this Tuesday the preliminary data published at the end of last month, the increase in prices of food and services, which remain above average, has given impetus above all to inflation in October. On the other hand, the evolution of energy prices also slowed the inflation rate in October, although to a lesser extent than in previous months.
- The monthly report of the Organization of the Petroleum Exporting Countries is published (OPEC).
- The Spanish Treasury is holding a new auction of bills of exchange, the last one in November. Offers letters for 3 and 9 months. In the first case the reference is the marginal interest of 3.067% obtained from the auction on 8 October.while in the second case it is equal to 2.848% of the same issue.
- “After Donald Trump’s victory, a new period of uncertainty opens, which could translate into an increase in volatility in the coming months, favoring better entry points in the stock markets,” says Nuria Álvarez, analyst at Renta 4.
- Huw Pill, of the Bank of England (BoE), appears, as do Christopher Waller, Thomas Barkin and Patrick Harker, of the Federal Reserve (Fed).
What do the analysts say?
MacroYield: “History favors the prospect that stocks could continue to have a positive path, as election years have produced positive returns for the S&P 500 and even one year after the election result. The fact that the US economy continues to show strength and that the Fed, albeit at a slower pace than expected, continues to adopt an accommodative stance, are further reasons. Historically, however, the S&P 500 Index has risen more with a divided Congress, in anticipation of more moderate policies, but recent years of sharp divisions and even blockades on relevant legislation have moderated this statistic, and investors are discounting a positive decision by Trump. they will likely have a clear path to adopt his policies.”
What is the evolution of debt, currencies and commodities?
In the raw materials market, Brent oil fell by 0.27% to 71.630 dollars a barrel.
The threat of possible tariffs from the new White House administration has put pressure on the euro and the Chinese yuan. The single currency hit an almost seven-month low of $1.0687 overnight, while the Chinese yuan fell to a more than three-and-a-half-month low.
In the debt market, the required interest on the 10-year bond rises to 4.368%.
Stock Markets – Currencies - Debt - Interest Rates – Commodities
Interview between Time.news Editor and Stock Market Expert Juan Pérez
Time.news Editor: Good morning, Juan! Thank you for joining us today. Given the recent drops in European stock markets, particularly the Ibex 35, what are your thoughts on the current market situation?
Juan Pérez: Good morning! It’s a pleasure to be here. The market environment is certainly volatile, especially with the Ibex 35 opening down by over 1% and moderating to a 0.7% decline. This reflects broader concerns from Asia, particularly stemming from expectations around U.S. economic policy under the new Trump administration, which is hinting at a tougher stance towards China.
Time.news Editor: That’s interesting. Speaking of the Ibex, we’ve seen a mix of performance within the index. Which sectors or companies are standing out at the moment?
Juan Pérez: Yes, exactly. On a positive note, Endesa has managed to gain 1.09%, reflecting perhaps some investor confidence in utility stocks amidst the uncertainty. On the flip side, companies like Merlin Properties and Colonial have recorded significant losses, dropping nearly 6% and 4.66% respectively. This seems to be due to an upcoming tax reform affecting their special tax regimes, which has spooked investors.
Time.news Editor: It appears that tax reforms are a hot topic. How do you think this will affect investor sentiment moving forward?
Juan Pérez: Tax reforms can create a ripple effect in market sentiment. Investors are often sensitive to changes in fiscal policies, especially those targeting specific sectors. As companies like Merlin and Colonial are exposed, we might see a short-term additional dip in their stock prices as investors weigh the implications of these reforms.
Time.news Editor: Besides the Ibex, how are other European markets responding to the overall situation?
Juan Pérez: Other European markets are reflecting similar trends. For instance, the German Dax fell by 0.9%, and the French Cac by 0.8%. It seems the sentiment is quite uniform across Europe, driven largely by Asian market performances and concerns about U.S. policy changes. Such interconnectedness suggests that European indices are very much in tune with moves in global markets.
Time.news Editor: The Asian markets have certainly taken a hit. What specifically caused the decline there?
Juan Pérez: The decline in Asia can be attributed to apprehensions surrounding the new U.S. administration’s stance toward China and its potential geopolitics. As we saw, the Hang Seng dropped sharply by nearly 3%, and this fear translates into risk aversion for investors. Moreover, we are witnessing significant pulls in sectors like technology, hinting at a broader sell-off as market participants shift their strategies.
Time.news Editor: With U.S. markets closing on a high note, do you see a divergence in sentiment between the U.S. and European markets?
Juan Pérez: Absolutely. The U.S. has experienced a surge, particularly driven by tech stocks, which have hit all-time highs in indices like the Nasdaq. This can be partly attributed to optimism about economic recovery coupled with lower interest rates. Meanwhile, Europe is wrestling with uncertainty, especially with tax reforms and geopolitical risks, which creates a divergent economic outlook.
Time.news Editor: Before we wrap up, what should investors keep an eye on in the upcoming weeks?
Juan Pérez: Investors should monitor developments regarding the U.S. administration’s policies, especially concerning international trade and relations with China. Additionally, keep an eye on domestic issues like tax reforms in Spain that could shake specific stocks. with increased volatility expected, there may be potential opportunities for savvy investors seeking to enter the market at lower points.
Time.news Editor: Thanks, Juan, for your insights today. It’s clear that the market landscape requires careful navigation in the coming weeks.
Juan Pérez: Thank you for having me! It’s always important to stay informed and adaptable in these dynamic times.
