The selection exceeds 9,200 points in a day marked by the rise in interest rates by the ECB
The hangover of the Federal Reserve (Fed) this Thursday gave way to a new day that was dominated by the central banks. The ECB took over from the US agency with a stronger rate hike of 50 basis points, until the reference rate remained at 3%.
The market discounted the move for months. Investors have therefore paid much more attention to Christine Lagarde’s words and especially to the boost that Banco Santander’s results have given to the Spanish stock market, which soared by 5.7% to EUR 3.43 per share at close. The entity achieved a record profit of EUR 9,605 million in 2022.
The emergence of the entity allowed the Ibex-35 to close with an increase of 1.45% to 9,229 points. These levels have not been seen since June 2021. 20 months ago. Besides Santander, Grifols (+9.27%) and Fluidra (+8.18%) recorded the strongest increases. Meanwhile, in the lower part of the table, Sabadell (-3.99%), Repsol (-2.94%), CaixaBank (-2.40%), Bankinter (-1.23%) and Acerinox (- 0) up. .
The session was marked by the ECB’s meeting, after the Fed unanimously approved a rate hike of 25 basis points, to place them in a target range between 4.50% and 4.75%. For its part, the ECB decided to act more aggressively.
Consensus points to another 50 basis point increase in March. “However, that aggressive pre-commitment was tempered by the statement that the Council will reassess the course path at the March meeting and the reiteration of reliance on economic data,” explained Anna Stupnytska, economist at Fidelity International.
Francisco Quintana, director of investment strategy at ING, agrees with this assessment. “Today’s meeting was a step back in terms of the quality of communication,” he says. In his opinion, the selection of phrases – crucial in these times for the markets – was “unfortunate and confused many analysts.”
The reason for the confusion is the ECB’s use of phrases such as “continuing in a stable manner”, or the hodgepodge of ideas suggesting absolute flexibility, such as “meeting to meeting” or “data dependent”, despite the commitment to keep rates at 50 basis points in March no matter what.
Against this background, we will have to wait for the next sessions to determine the real impact of the ECB on the equity and fixed income markets. And it is that investors had to digest other key references on Thursday, such as the Bank of England’s decision to raise its reference rates by another 50 basis points, which now go to 4%. It is the highest level since the fall of 2008.
Meanwhile, in the commodities market, the price of a barrel of Brent crude, the benchmark in Europe, stood at $82.7, while West Texas remained at $76.4.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
