October is meeting expectations. Stock exchanges fell 1% on average yesterday with the excuse of a bad manufacturing ISM on the other side of the Atlantic and continue to cut positions strongly this Wednesday (Ibex: -2.2%; 8.991; Cac: -2.8%; Dax : -2.3%). This month is traditionally bearish for the indices and, for now, declines are what they are seeing. ArcelorMittal or Viscofan are the values that fall most within the Spanish selective, while Acciona is practically the only one that goes up thanks to a good recommendation from RBC.
- 11.436,400
- -0,27%
ArcelorMittal (-5.87%) and Amadeus (-4.3%) have been the worst values of the Spanish selective, while MásMóvil (+ 0.18%) and Acciona (+ 0.18%) have been the only ones with earnings. The energy company has closed in green thanks to a good recommendation from RBC.
The Ibex has fallen more than 1% during the whole session, but the red numbers have increased after knowing that the World Trade Organization (WTO) has given free way to the US to impose tariffs of 7.5 billion dollars annually on the EU. This news has increased the fear of investors of a trade war between the two territories.
The rest of European exchanges have also closed with losses exceeding 2%. The Ftse 100 has been the most punished, with a fall of 3.18%, weighed down by the latest proposal of the British Prime Minister, Boris Johnson, to the EU, based on the elimination of the 'safeguard' or 'backstop'in Ireland.
MACRO DATA AND COMPANIES
After yesterday's manufacturing ISM, investors remain aware of macro data across the Atlantic. Today, the employment report of the ADP consulting firm in September has been published, leaving 135,000 when the estimate was 140,000. The data represents a fall compared to August 157,000 (revised from 195,000). In Spain, the September strike has been published, which rose by 13,907 people, its lowest rise in this month since 2004.
"Looking at the global picture, it is fair to say that the global manufacturing sector is in trouble. The trade dispute between the US and China is having a worldwide chain effect, so yesterday we saw a strong downward movement in the indexes because of this. Trade talks between the US and China will continue next week, so operators will pay close attention to the issue "says David Madden, an analyst at CMC Markets.
TECHNICAL ANALYSIS
"The month of October has not been able to start properly (from Tuesday's highs we have fallen 4% in just two sessions). And as we warned this Tuesday" we didn't like the bearish envelope, as well as the bearish divergences that the Ibex left us ", yesterday. And this Wednesday we have 2.5% falls in the stock markets of the Old Continent," said José María Rodríguez, an analyst at Bolsamanía.
"In principle these falls would fit within the typical corrective phase or proportional adjustment of the accumulated increases since the minimum of August. In the case at hand, specific rebounds aside, the truth is that we no longer have important supports until the area of 8,750 points (61.8%) - 8,800 points (bullish hollow of the session on September 4.) Let us hope that the correction will slow down around these price levels, because if so, it would fit more or less within normal parameters, "he adds.
"And looking at Wall Street, it seems key that the August lows are respected, this is 2,820 points of the S&P 500, 25,340 points of the Dow Jones and 7,355 points of the Nasdaq 100. But let's not forget that we are in October and on many occasions this month has become especially hard. And we've just started it, "concludes the analyst.
