The Spanish stock market puts on the brakes after three consecutive days of strong increases in which the Ibex-35 has gone from 8,200 points to seek 8,500. That is the level that it manages to reach in the first stages of trading with a timid rise that will have to wait for the opening of Wall Street to consolidate.
Among the great protagonists of the day is Siemens Gamesa, which on Tuesday was the most bullish value of the day. And it is that the rumors of a takeover bid by Siemens Energy have gained strength again these days, while the Bloomberg agency picks up as the company is preparing an offer to take over the third that it does not yet control of the wind turbine manufacturer. Siemens Gamesa’s stake would be valued at current market prices at around 3,140 million euros.
Also pay attention to the evolution of Repsol which, benefited by the rise in oil prices, this Wednesday could be favored by the improvement in recommendation launched by HSBC analysts, who raise their advice on the value from ‘hold’ to ‘buy’ ‘.
Although investors keep the compass button activated, analysts warn that the recent rally in Western stock markets these days “will have a limited duration.”
From the Link Securities analysis department they consider that these increases have been the product, mainly, of two factors. On the one hand, the high pessimism of investors, “reflected in multiple confidence indicators, something that usually works well as a contrarian indicator in equity markets, propitiating this type of reaction.” On the other hand, “the high level of overselling that many securities and the main indices presented, something that also tends to lead to strong rallies.”
However, from the firm they consider that “we are witnessing one of the typical rebounds that bear markets usually experience.” Moreover, at the moment they do not identify solid catalysts that could modify the underlying downward trend of the markets, “with the growth of the main economies going down, inflation probably going up and interest rates maintaining their upward trend.”
Without major macroeconomic references on the day, except for new inflation data in the euro zone and the United Kingdom, investors are still pending the evolution of the confinement policy in China and the messages from the US Federal Reserve (Fed), after that the president of the organization, Jerome Powell, reaffirmed yesterday that the fight against inflation is the main objective of the institution.
The markets thus discount two more interest rate hikes of 50 basis points, double the usual 25 points, at the next Fed meeting. And that once again boosts long-term bond yields, which are moving from reverse way to price.
Specifically, the interest on the ‘treasury’ (ten-year US bond) is approaching 3% again, a level from which it moved away last week with the wave of bond purchases carried out by investors in search of an asset considered to be more certainly equities. In Europe, the movement is more moderate, but the ten-year German paper remains above 1%, while the Spanish is around 2%.
In the raw materials market, the price of oil resumes its rises and a barrel of the Brent type, a reference in Europe, is above 112 dollars, while the West Texas of the United States exceeds 111 dollars, at a time when in which the cross between the euro and the dollar (currency in which the prices of raw materials are denominated) is around 1.05 dollars, with many voices already warning of parity in the short term, given the different pace of monetary policies to both sides of the Atlantic.
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