Employees at the London Stock Exchange. /
The British currency recovers ground after the decision of the Government to abandon its tax reduction plan
Caution prevails at the start of the last quarter of the year after a month of September that has been the worst in decades for equity markets around the world. In addition to inflation and the fear of recession, investors are facing new fronts that they will try to deal with in order to redirect the downward trend of recent weeks.
Among them, the upward reaction in oil prices just a few days before the expected OPEC meeting in which the member countries could announce a sharp cut in production to stop the fall in prices in recent months.
Given this perspective, the Brent-type barrel, a reference in Europe, rose more than 3% to recover 87 dollars, while the US West Texas rose to 82 dollars.
While waiting for the meeting, the absolute leading role of the day is for the British market, after the Government of Liz Truss has been forced to back down on its plan to lower taxes on high incomes in the country. A decision that last week caused strong tensions in the markets and a real collapse of the pound in its crossroads with the rest of the currencies that even forced the Bank of England to intervene in the market.
After the withdrawal of the Executive, the market reaction has not been long in coming and the pound rebounds to a one-week high, to 1,128 dollars.
Against this background, the Ibex-35 extends its downward streak with falls of 0.5%. However, he manages to maintain 7,300 points. And we will have to wait for the opening of Wall Street to see if the red numbers consolidate.
Against this backdrop and waiting for the numerous open fronts to clear up, the Ibex-35 is extremely cautious with Amadeus (-2.71%), Meliá Hotels (-2.25%), BBVA (-2, 01%), Inditex (-1.97%) and Aena (-1.92%) leading the declines. On the opposite side were Repsol (-1.5%), Cellnex Telecom (+1.13%), Enagás (+0.25%) and Indra (+0.13%).
Investors are also closely following the evolution of the price of Credit Suisse, which plummets more than 9% after an intense weekend in which rumors about the possible bankruptcy of the entity, a giant in the sector of investment banking, have been constant.
The firm’s own CEO, Ulrich Koerner, has admitted that Credit Suisse is in a “critical situation”, although he has also defended its liquidity and solvency capacity in the current environment. Despite this, the firm’s so-called CDS (credit default swaps) are at levels never seen since 2009, in the midst of the financial crisis. Investors buy this type of product to protect their position against a possible bankruptcy of the underlying entity.