2023-07-24 19:26:10
Investors do not like the lack of definition, but the results that came out of the polls this Sunday of general elections, with practically a blockade when it came to being able to form a government, have not finally made much of a difference in the Stock Market. The market reaction went from more to less during the session on Monday. Although the market started with a loss of more than 1.5%, it finally dropped 0.29%, almost unperturbed by the uncertainty generated around the results and who will be the Prime Minister. The Moody’s agency has warned of the risk that this situation will pose to an economy like the Spanish one “already weak in itself.”
The reaction of the Ibex on this Monday is not very far from what it usually has every day of a hangover after a general election. On nine of the ten previous occasions in which Spain has gone to the polls to elect the President of the Government, the Stock Market has fallen, and only in one session did it manage to advance timidly. The market almost always reacts downward, although with different nuances.
Four years ago, with the general elections on November 10, 2019, the Ibex ended practically flat, yielding a minimum of 0.06% after the victory of the PSOE and the possible coalition government with Unidas Podemos. Eight months earlier, in April of that year, the Stock Market rose 0.19%, although the blockade was more than evident, as has happened in 2023, when no party had the capacity to govern.
In the rest of the last ten times in which general elections have been called, the stock market has always fallen. Above all, it did so after the 2011 and 2015 elections – in which Rajoy’s PP won – with declines of more than 3%, conditioned by the financial and debt crisis of the great recession. With Zapatero, the market also gave way after his two victories (in 2004 more than 4% and in 2008 just a few tenths). While in the Aznar era, the stock market plummeted 5% (in 1996) and more than 1% four years later.
The listed companies are very pending this Monday of a key week to determine the future of the stock market, with the meeting of the European Central Bank (ECB) and the North American Federal Reserve (FED) in which both monetary organizations will make a new decision on interest rates. In the euro zone, a rise to 4.25% is not ruled out given inflation data that continues to show strength. On the other hand, investors look askance at the semi-annual results that listed companies will present over the next five days.
#stock #market #remains #immune #electoral #blockade