Ibex fails to bounce back and marks new two-year lows

ArcelorMittal was the red lantern of the session, with a drop of 5.8% to 21.66 euros. DIA followed with a 5.65% fall on Wednesday and has been close to marking another historical minimum. The company, which yesterday bounced 10%, has reorganized its board of directors and has cast three members: the director of new business, the purchasing executive and director of the supermarkets La Plaza.

In addition, Moody's has indicated in a report that DIA's profits will continue to fall in 2019, despite the fact that the Spanish economy will continue to improve and that employment will fall in the next year. In this way, the supermarket chain has once again suffered a blow.

The banks listed red once again. Banco Sabadell has dropped 3.3% to 1.04 euros and is only 5% lower than historical lows (0.9885 euros). Caixabank has fallen 2.34%; BBVA, 2.04%; Bankia, 1.83%; Banco Santander has dropped 1.41%; and Bankinter, 1.36%. The two big ones have set new annual minimums.

On the other hand, Siemens Gamesa has been the value with the best performance of the Ibex, since it has risen 1.93%; followed by Colonial (+ 1.84%). We also highlight the 0.78% rise of Inditex, which closed at 24.55 euros. The fall of the banks means that investors have their focus on another of the great values ​​of the Ibex.

Business results are still the main focus of investors. This Wednesday was the turn of Iberdrola. The company obtained a net profit of 2,091m euros in the first nine months of the year, which represents a fall of 13.5% compared to the same period last year, when it reported over €700m. The company has risen 0.22% to 6.3 euros.

Ignacio Sánchez Galán, president of Iberdrola, has been concerned about the changes in regulation in the electricity market agreed by the Government and Podemos. These changes point to a cut in the remuneration of hydroelectric and nuclear energy. However, Galán has assured that the power plants of both energies are not amortized.

OTHER MARKETS

The rest of the stocks of the Old Continent have closed with a mixed sign. The German DAX 30 and the French CAC 40 have closed with falls of 0.8% and 0.3%, respectively; while the FTSE 100 in London has risen 0.15%. In Europe, Deutsche Bank drops 4% after gaining 65% less.

Europe is on the 'tightrope' because Italy is standing its ground and does not seem to be back on its budget targets, at least that's what Matteo Salvini said. In a historic and unprecedented decision, the European Commission (EC) has rejected the Italian budgets for 2019 that pose a deficit target of 2.4%. The photo of an Italian MEP putting a shoe on the rejection document from Brussels gives an idea of ​​how tensions are rising in the country and what their attitude to the response of the EC will be.

In case the uncertainty coming from Europe was not enough, Donald Trump and has once again attacked the Federal Reserve (Fed) President, Jerome Powell, for his policy of raising interest rates. "Obama had zero interest rates," recalled Trump, adding that "it almost seems that Powell is happy to raise rates." These types of comments are not new to Trump and have been criticized for what is considered an attempt at clear interference in the Fed, which should be an independent body. While Wall Street quotes with falls, which in the case of the Nasdaq are higher than 1.3%.

And then there is that element of 'local' uncertainty that supposes the sentence of the Supreme one on the tax of the mortgage and that will not be known until the 5 of November. This issue implies added pressure for the Ibex insofar as the banks have a fundamental weight in it.

In the macro sphere, PMI services and manufacturers in Europe have been published, showing that the economy of the Euro Zone expanded in October at the slowest pace in more than two years.

On the other hand, the oil tries to recover from the falls of this Tuesday, yielded more than 5%. The barrel of Brent rises 0.64% to 77 dollars and the barrel of West Texas, reference in the US, up 1.2% to 67.24 dollars. In the currency market, the euro has lost $ 1.14.

TECHNICAL ANALYSIS

"The weakness of our index, like that of the set of European indices, remains intact," said José María Rodríguez, technical analyst at Bolsamanía. "And let's cross our fingers so that the highs of this Wednesday are not part of a simple 'pull back' to the base of the low channel that we just lost, because if so we can expect new and important falls in the next sessions", he adds .

For the expert, the key to the indentation of the month of October could continue or not depending as always on Wall Street. Now we must be attentive to the minimums of last week in the three major indexes. If we drill to the other side of the Atlantic, last week's minimums would have the confirmation of the start of another bearish lash, similar to the previous one.

Thus, the supports to watch are in the 24,900 points of the Dow Jones, the 6,900 of the Nasdaq 100 and the 2,700 points of the S & P 500. In addition the extreme weakness of European banking as a whole is now followe by the automobile sector, which seems to address the Brexit minimums. "The truth is that either we rebound with great force and imminently or I fear that in the end the Dax will meet its target of falling by 10,000 points, that is, an additional 10% drop for the index of the 'European locomotive' ', with its consequent contagion for the rest of its neighbors, "concludes José María Rodríguez