The Ibex opens the month with falls of 3.6% due to tensions between China and the US

The European stock markets have kicked off the month of May with important falls. The Ibex has dropped 3.6% due to tensions between the United States and China due to the virus. Within the selective, the cuts by Merlin (-8.27%), IAG (-8%), Repsol (-7.79%) or ArcelorMittal (4.97%) have stood out, the latter being especially sensitive to the friction between the two powers. On the positive side, Telefónica has found itself, which has risen due to the integration of its business in the United Kingdom with that of Liberty Global there.

US President Donald Trump has said Sunday that he believes a "mistake" in China has caused the spread of the coronavirus pandemic, although he has not presented any evidence to justify such a claim. Trump has claimed that China "made a horrible mistake and does not want to admit it."

The main US spy agency said last Thursday that it has determined that the virus is not of human origin, but is still investigating whether it was caused by "a laboratory accident in Wuhan." China has rejected claims that the virus escaped from a research center in Wuhan.

Meanwhile, those infected with coronavirus continue to rise, with the number of global cases exceeding 3.5 million. The virus has caused more than 247,000 deaths worldwide. Infections and deaths continue to decline in Europe and the United States, but Latin America and Africa are now seeing an increasing number of cases, Reuters has warned.

This Monday will continue the publication of results. In Spain, Endesa or Liberbank stand out. The financial entity has reported a fall of 7.7% in its profit until March after provisioning 23 million for the Covid-19.

At the macro level, the April PMIs in Europe have been published today. The euro area PMI index stood at 33.4, a result well below 44.5 points in March. Below its previous flash reading, the recent PMI was the lowest ever recorded by the series (which began in June 1997), beating the readings seen during the peak of the global financial crisis and indicating a considerable deterioration in operating conditions.

TECHNICAL ANALYSIS

"The Ibex has closed at the lows of the day with a drop of 3.6%, which is not bad at all. And what is worse is that it is dangerously close to the support that we have talked about so much in recent weeks: the bullish gap of the 6,580 points that managed to stop the last fall. A close below would be the first sign of weakness in several weeks, "explains José María Rodríguez, technical analyst at Bolsamania.

"The main danger is that our Ibex has lagged far behind on the rebound compared to Europe and Wall Street as a whole and at the slightest sneeze there we will catch the flu," he added.

"The case is that if the mentioned support is clearly drilled , we cannot rule out a return to the most important support, the March lows at 5,814 points. Above, on the resistance side, the most immediate one we have right now at 7,130 points, the highs of last week ", ends the expert.