Spain’s stock market opened on Thursday with a rally to its highest levels in 15 months as markets welcomed comments from the Federal Reserve that point to a near end to the tightening cycle of financial conditions in the United States.
The Fed raised its benchmark interest rate by a quarter of a percentage point, as planned, and warned of further increases, but, despite warning that it would be “very premature to declare victory over inflation”, indicated that a turning point had been exceeded in the fight against price increases, signaling the beginning of a “disinflationary” process.
These comments gave equity markets free rein, while dragging down U.S. bond yields and the dollar.
Now it is the turn of the European Central Bank and the Bank of England, with expectations of greater toughness in the entity chaired by Christine Lagarde.
“We believe that the ECB will maintain the hawkish tone of its most recent statements (including President Lagarde), to the extent that it started rate hikes later (July 2022) and its inflation is more resilient,” said analysts at the Renta 4 (BME) brokerage:RTA4).
“The Bank of England could also rise +50 bps (basis points) to 4%, with the focus on the division of opinions and guidance for the future, in the face of an economy that slows but inflation is still high (10.5%). The market is targeting a ceiling of 4.5% in the middle of the year, with two additional +25 bps increases following next week’s,” they added.
Beyond Thursday, the next big quote for the macroeconomy will be the U.S. jobs report on Friday, as analysts analyze the quarterly figures that large companies are shelling.
On Thursday, Santander rose 2.4% on the stock market after announcing that its net profit in 2022 increased by 18%, reaching the record figure of 9,605 million euros, thanks to the increase in loans, although the results were overshadowed in the fourth quarter, as provisions more than doubled due to economic uncertainty.
In the rest of the banking sector, BBVA was down 0.15%, Caixabank advanced 0.17%, Sabadell fell 0.12%, Bankinter was left 0.39% and Unicaja Banco rose 0.44%.
Among the large non-financial securities, Telefónica was recorded by 0.26%, Inditex advanced 1.28%, Iberdrola was revalued by 0.05%, Cellnex gained 1.65% and the oil company Repsol lost 0.50%.
For its part, the selective Spanish stock market Ibex-35 rose 76.90 points at 08:05 GMT on Thursday, 0.85%, to 9,175.00 points, its highest level since November 1, 2021, when it closed at 9,182.6, and to overcome this last barrier would be the maximum since June 14, 2021. Meanwhile, the FTSE index of large European stocks Eurofirst 300 advanced 0.50%.
