The Capricorn recovers 8,000 points after a 2.5% loss this Tuesday, the community currency remains at its lowest point against the dollar and oil rises to $104 a barrel
The Spanish stock market is recovering and, as usual after a significant drop, starts this Wednesday with a recovery that, although it is back above 8,000 points, rises barely 0.9%, much less than the two and a half points that came to are left behind this Tuesday amid the avalanche of data that anticipates a period of economic slowdown due to the effect of inflation.
This session will be marked by new macro data and the US Federal Reserve’s minutes. Major European markets also woke up positively this Wednesday, with increases of 1.5% in London and Paris and 1.1% in Frankfurt.
Within the Ibex 35, almost all recorded values rise in the first bars of the session. The largest increases were recorded by IAG (+3.9%), Inditex (+2.7%), Meliá (+2.2%), Aena and ArcelorMittal (+1.9%) and Amadeus, BBVA and Santander, with increases of 1.6% in the three cases. Among the declines, Colonial stood out, returning 2.1% at the opening.
On the other hand, the price of a barrel of Brent grade oil, a benchmark for the Old Continent, is now trading at $104.60, up nearly 1.8%, while the Texas was at $100.89, showing a increase of 1.4%.
On the foreign exchange market, the euro lost positions against the dollar and traded against 1,0260 greenbacks. The exchange rate of the euro against the dollar fell yesterday to its lowest level since December 2002, reflecting increasing risks of recession in the euro zone and the less aggressiveness of the European Central Bank (ECB) in normalizing its monetary policy. And in the debt market, the Spanish risk premium was around 111 basis points, while the required yield on the 10-year bond was 2.314%.
On Monday, the recession drums hit the market again strongly with the Ibex-35 closing the session down 2.5% to 7,959 points. It is the lowest level since March, in full swing after the outbreak of the war in Ukraine. The collapse was even greater in Italy, Germany and London, where the reds were around 3%. And Wall Street also presented red numbers at the close of the European stock markets.
Investors are fleeing risky assets as new benchmarks point to a direct path to economic contraction. Yesterday it was weak PMI data in the euro-zone (which fell from 54.8 in May to 52 in June) that pushed the single currency to a 20-year low against the dollar. This indicator is mainly followed by investors due to its sophisticated nature. And it’s getting closer and closer to the 50-point line that marks the divide between economic contraction and expansion. The European Commission’s summer economic forecasts will be released next Wednesday.
The prospect of a slump in demand in the face of a possible recession has also put oil prices under pressure. On Tuesday, they fell 9% on the futures market to a three-month low, with a barrel of Brent, a benchmark in Europe, trading at $103. The American West Texas, for its part, even lost the $100 mark at the most tense moments of the session. “Investors should be prepared for the risk of larger losses,” warns fund manager AXA Investment Managers.
Source: La Verdad
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
