The Spanish stock market is slowly recovering. It does so after a substantial decline. However, this Wednesday’s rebound puts it back over 8,000 points. But it barely moves 0.9%. This Tuesday was amidst the flood of data that predicts a period of economic slowdown because of inflation.
New macro data and minutes from the US Federal Reserve will mark this session. This Wednesday saw positive developments in the main European markets, with gains of 1.5% in London, Paris, and 1.1% respectively in Frankfurt.
Nearly all of the Ibex 35 values saw increases in the first bars. IAG (3.9%), Inditex (2.7%), Melia (22.2%), Aena (1.9%), ArcelorMittal (1.9%), and Amadeus (BBVA, Santander) all recorded the largest increases with increases of 1, 6%. Colonial, which had a yield of 2.1% at the beginning, stood out among the decreases.
The price of a Brent quality oil barrel, which is a reference for Old Continent, now trades at 104.60 USD, an increase of almost 1.8%. Texas, however, was at 100.89 US dollars with an increase in 1.4%.
The euro traded at 1.0260 greenbacks on the currency market after losing positions to the dollar. Yesterday’s drop in the exchange rate between the euro and the dollar was due to growing risks of recession within the eurozone as well as the less aggressive monetary policy of the European Central Bank (ECB). The Spanish risk premium was approximately 111 basis points. The interest rate on the 10-year bond was 2.314%.
The market was once more in recession and the Ibex-35 closed the session with a 2.5% decline to 7,959 points. This is the lowest level it has been since March, when the market was in tension following the outbreak of war in Ukraine. It was even worse in Italy, Germany, and London where the red numbers were at around 3%. Wall Street was also affected by the collapse of the European markets.
As new benchmarks point towards a direct path of economic contraction, investors are fleeing risky investments. Yesterday’s weak PMI data from the euro zone, which fell from 54.8 in May to 52 June, was what drove the single currency to its lowest level in 20 years against the dollar. Investors are particularly interested in this indicator due to its advanced nature. It is now closer to the 50 point limit, which marks the boundary between expansion and contraction. The European Commission’s summer economic forecasts will be released on Wednesday.
Oil prices have been under pressure due to the possibility of lower demand amid a possible recession. They fell 9% on Tuesday in the futures market, to three-month lowests. Brent, which is a reference in Europe was trading at 103 US dollars. The American West Texas, for its part, lost even the 100 dollar barrier in the most volatile moments of the session. AXA Investment Managers warns that investors must be ready for greater losses.
