The Spanish Stock Market Profits As Uncertainty Over Evergrande Persists

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Sep 24 (Reuters) – The main Spanish stock index ended a three-session bullish streak on Friday, as markets opted for caution as the fate of indebted Chinese real estate developer Evergrande remains unclear.

The company approached a suspension of payments on Friday by missing an interest payment deadline, but a 30-day grace period is now open in which it can settle said interest. Added to this was the injection of new funds by the Chinese central bank into the market to contain the fear of contagion to the rest of the economy.

The market continued to digest the confirmation that the United States Federal Reserve (Fed) and the Bank of England will initiate the withdrawal of stimuli soon, although the gradual format of the withdrawal gives reassurance to investors at a time when risks still weigh on stocks. economies, both due to the evolution of the pandemic and the problems of supply chains.

In this sense, on Friday afternoon there will be interest in an appearance by several members of the Fed.

“Probably many of the questions will focus on the ‘how’ and ‘when’ of ‘tapering’ (reduction of stimuli). And any response somewhat more ‘hawkish’ (prone to monetary tightening) than expected will also be a reason for the caution in the American session, “Bankinter analysts said.

During the session, the index of the IFO survey in Germany in September will be known, which according to the Spanish brokerage house Renta 4 “could stabilize after two months of falls, supported by an improvement in the current situation and a slight additional moderation in expectations.”

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At 07:05 GMT on Friday, the selective Spanish stock exchange Ibex-35 fell 24.00 points, or 0.27%, to 8,852.90 points, while the index of large European stocks FTSE Eurofirst 300 fell 0.45 %.

In the week as a whole, the Ibex-35 shows a rise of 1.09%.

In the banking sector, one of the most benefited yesterday by the prospect of interest rate hikes – which raise the profit margins of the banking sector – Santander lost 0.70%, BBVA fell 0.77%, Caixabank lost 0.83%, Sabadell fell 0.88%, and Bankinter fell 0.40%.

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