Ibex suffers worst session of 2017 due to banking sector and Brexit

Spanish index falls 1.07% to 9,410 points

  • Banking sector shows apprehension ahead of possible hard Brexit
  • IAG, one of the stocks most exposed to Britain, registered harsh losses
  • Theresa May prepares to speak about the exit from the EU
| |
Marta Gracia
Bolsamania | 16 ene, 2017 18:30
bolsa_de_madrid_ibex_35_parque

The uncertainty surrounding Britain's exit from the European Union led to the Ibex 35's worst session of 2017 so far. The main worries concerned the banks and IAG, due to their relationship with the British market. One day before Theresa May is due to give an important Brexit speech, the Spanish index fell 1.07% to 9,410.

IBEX 35
11.711,800
  • 0,47%55,20
  • Max: 11.767,60
  • Min: 11.679,60
  • Volume: -
  • MM 200 : 11.125,61
17:35 25/11/24

Bankia was the worst performing stock of the day with a fall of 2.89% to 0.97 euros. Next up was another bank, Banco Popular, which dropped 2.34% to 0.91 euros. The bank was also in the news after implementing its bad bank with 40 real estate offices.

With falls of almost 2% they were followed by Banco Sabadell and Caixabank. BBVA and Santander also closed with losses, of 1.54% and 1.63% respectively. IAG was the third biggest faller with 2.33%. The Spanish holding company, the result of a merger between Iberia and British Airways, has its headquarters in London, and was punished ahead of Theresa May's Brexit speech.

On the leaders side, Mediaset was the highest gaining stock of the day: +2.71% to 11.53 euros. The company surpassed the price recommendation from Citi last Friday, when it was at 11.3 euros. Acerinox was next with an advance of 1.44% to 12.6 euros. DIA accompanied them with a gain of 1.40% to 4.80 euros.

UNITED KINGDOM IN FOCUS

Looking towards European markets, Monday saw an end to the Ftse 100's hot streak of 14 days of gains, losing 0.15%. The pound fell to a three month low on fears of a Hard Brexit. It fell 0.66% to 1.13 euros.

This week is particularly important for Britain, as May will set out the next steps in the process for the country on Tuesday. Chancellor Philip Hammond's comments at the weekend suggested that if the country loses market access, it will call for a new economic model.

Other European markets finished in red too. The Cac 40 in France was 0.82% lower and the Dax 30 in Germany was reduced by 0.64%. In these markets, the banking sector and automakers were the worst affected.

TECHNICAL ANALYSIS

José María Rodríguez, Bolsamania technical analyst, emphasised that the the index missed a good opportunity to attack the next hurdle of 9,550 points.

"We said at the end of last week that in order to head towards that the finance stocks would have a big role to play," said Rodríguez.

"All things considered erratic movements of the last few weeks form part of the lateral consolidation of levels, in which we find ourselves trapped in since December, " he added.

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