The Ibex loses the 9,800 points due to Brazilian crisis and G7 uncertainty

The Ibex 35 lost this Friday the 9,800 points, just one day after having recovered them. The index has fallen with strength throughout the session. At the close, 0.84%, to 9,746 points, after Wall Street closed on Thursday with moderate cuts but, above all, amid the worsening of the Brazilian crisis, which has meant that the Bovespa has fallen 3% and the Brazilian real will continue with its strong devaluation. The Brazilian stock index has fallen this Friday to 2%.

However, the Ibex has risen in value about 1.2% in the accumulated week (last Friday closed at 9,632.4 points), but for now it has slowed its climb towards the 10,300 points, next important level of resistance.

But this does not mean that the situation in Brazil is less worrying given that the country is one of the main markets of many European companies, such as Santander (-1.48%) or Telefónica (-2.02%) in Spain. The operator today held an ordinary general meeting, in which the president of the company, José María Álvarez-Pallete, appeared. It has also announced that it will pay a gross dividend of 0.20 euros per share on June 15 and December 20.

BAJISTAS, ALCISTAS AND OTHER STOCKS

Also DIA (-3.24%) is being affected by the situation in Brazil: this Friday it was one of the worst Ibex values. Only Aena has done worse(-3.67%), which has been the 'red lantern' of the session due to the possible downward revision of his dividend. The airport manager and the supermarket chain was followed by Arcelormittal losses (-2.47%).

Thus, only four companies managed to finish the session in green: Grifols (+ 3.78%), Viscofan (+ 1.40%), Amades (+ 0.57%) and Red Eléctrica (+ 0.11%).

Regarding the main board, it is worth mentioning that the construction company OHL has dropped more than 1.1% after knowing that it will lay off 140 workers in the framework of its cost reduction plan. In addition, Duro Felguera has been left almost 5% after it has agreed with Petroza Limited to extend the term for the purchase option until June 14.

The rest of European parks have also been dyed in red in a generalized way this Friday. Except the Paris Stock Exchange, which has managed to raise just 0.03%. Meanwhile, on the other side of the Atlantic, Wall Street registers losses of between 0.05% and 0.20%.

THE G7 IS ALSO SOURCE OF CONCERN

There is another added element that also worries investors and has to do with the G7 summit and the growing commercial tensions between the European Union (EU) and the United States, tensions that have even led Emmanuel Macron, French president, to raise the possible departure of the United States from the G7.

"The ongoing trade dispute between the United States and its allies will attract a great deal of attention as the G7 summit kicks off on Friday, and Wall Street fell on Thursday as investors are beginning to show concern over the climate of the summit." Jasper Lawler, chief strategist at London Capital Group.

Lawler adds that there is little doubt that trade relations will be the "big issue" of the summit on Friday and Saturday in Canada. "Given the tariffs imposed by Trump on his allies and the unpredictability of his behavior, uncertainty could remain the central pillar of negotiations between the different powers." Trump maintained a dispute on Twitter with the French president before the meeting, which is not a good omen, "says this expert.

"The feeling of risk has increased this Friday amid the political tensions between the United States and the rest of the G7 countries, to which we must add the extra pressure of the crisis in emerging countries, such as Brazil," the experts from Danske Bank. "The political uncertainty before the elections, together with the general feeling of turmoil in emerging markets, are putting pressure on Brazil," they add.

In addition, the risk premium increases again in a generalized manner in the Eurozone. The geopolitical uncertainty that has awakened the statements of Emmanuel Macron on the possibility of excluding the United States from future agreements of the 'G7' for its tariff policy has increased the pressure on debt sales in the Eurozone.

TECHNICAL ANALYSIS

José María Rodríguez, Bolsamanía's technical analyst, considers that "despite the falls of this Friday, the truth is that there are no changes with respect to the speech of the last days." For the moment, everything is part of a simple rebound (reaction phase)within a corrective phase of a higher order ".

"And we want to take hold of the fact that the Ibex, in its last fall, has built us a first ever high, it may be, with the passage of time, the beginning of something else, some kind of figure back. there is no confirmation of it yet and, furthermore, if it occurs it will take time, "he adds.

"Somehow we continue to think that as long as the European stock markets respect the minimums of last week there is room for hope," explains the expert. "Drilling could no longer be said that the correction fits within the normal parameters, although it is true that we should know that both the Ibex and the Italian stock market (FTSE MIB) are the indices that are weakest and with much difference," he says. Rodríguez "Regarding companies, it would be good for Telefónica to respect the important support at 7.45 euros at all times," he concludes.