Ibex 35 falls 1% below 10,400 but ends the week up 1.5%

The Ibex 35 fell 0.96% to 10,357.80 points on Friday, dragged down by the likes of Repsol, Telefonica, BBVA and Santander, as well as Gas Natural, Caixabank and Banco Sabadell. However on a weekly basis the market was up 1.5%.

After the imprisonment of Oriol Junqueras and eight ex members of the Catalan government, investors interpret that the crisis in the region is a long-term one and the judicial process will be an important element ahead of elections on December 21.

Meanwhile, more analysts continue to reduce their growth forecasts for Spain and Catalonia as uncertainty and stagnation arrive further. Funcas joined the government in forecasting that Spanish GDP growth will be at 2.6% from 2.7% in 2018.

REPSOL AND AMADEUS

Repsol obtained net profits of 1.583bn euros in the first nine months of the year, 41% more than the same period last year. However, the net result for the third quarter reached 527m euros, below the 554m expected by FactSet analysts. Its shares were down 1.49%.

The IT services provider increased its profit to 846.7m euros, a 14.7% increase. Its shares rose 1.22% and they were the second best performers in the market, after Grifols, which rebounded 3.57% after falling 4% on Thursday. Few stocks finished on the black side on Friday, only Viscofan (+0.61%), Aena (+0.57%), Colonial (+0.52%), Endesa (+0.39%), Merlin Properties (+0.27%) and ArcelorMittal(+0.12%).

Siemens Gamesa picked up the wooden spoon once again however, this time after the tax reform proposed by the US suggests cutting wind projects in the country. Saabdell (-2.71%), Acerinox (-2.51%), Mapfre (-2.49%) and DIA (-2.37%) were among the other significant losses.

UNEMPLOYMENT FIGURES

Spain’s unemployment figures were released today. The number rose in October, as is traditionally the case. It did so stronger than the same period last year, rising 56,844 people registered with the public employment services, bringing the total number to 3,467,026. Catalonia led this growth after the October 1 referendum.

In the US, the economy created 261,000 jobs in October, a figure slightly less than anticipated but enough to confirm the strength of the labour market. Unemployment fell to 4.1% from 4.2%, lows of the last 17 years. The Dow Jones hit a new record, led by gains for Apple.

Central banks were also on the agenda this week with the raising of rates by the Bank of England and the nomination of Jerome Powell to chair of the Federal Reserve board.

TECHNICAL ANALYSIS

“The last session of the week leaves us with a bittersweet taste. On one hand, the index was not able to confirm a finish above the key resistance of 10,410 points. In fact we ended up drawing a weekly graph which closes far from the highs of the week and it’s not exactly a sign of strength,” said Bolsamanía technical analyst José María Rodríguez.

“However it’s true that the falls come as part of a typical throwback to the higher end of the lower channel from the last six months, now support and before it was resistance.”