Selective falls 0.4% but avoids the biggest declines in Europe and Wall Street
Caution. It is sentiment that continues to dominate investor sentiment in global equity markets, despite recent declines. Much more at the start of an important week that will see US CPI data out that, if higher than expected, would open the door to another recovery of another 75 basis points at this month’s Federal Reserve meeting (Fed).
The pressure is evident with declines in the world’s major trading floors, which also woke up Monday to the new uptick in Covid-19 cases in China, particularly in Shanghai, where a case of the new omicron variant has already been identified. the highly contagious BA.5, which set off alarm bells due to the impact of the ‘Covid zero’ policy that could take a serious economic and social toll on the country.
In Europe, where investors are more concerned about a possible cut in Russian gas supplies, the declines moderated towards the end. And the Ibex-35, which lost 8,000 points in its worst moments of the session, ended the day at 8,064 points down 0.4%.
Losses were more significant in other markets of the Old Continent, reaching 0.8% in Italy and even more than 1% in the German DAX. Red also prevailed on Wall Street, with a notable drop in major tech stocks, weighed down by the 7% drop recorded by Twitter after learning of Elon Musk’s decision to withdraw his offer on the social network.
IAG led the declines in the national stock market with losses of more than 5.7%, followed by Ferrovial and Sacyr with losses of more than 3%. Banks also went down in reds above 2.5% in BBVA and 2% in Sabadell or Santander, highlighting the cut in interest rates on the debt.
The greater uncertainty surrounding the evolution of the economy ensures a certain transfer from the stock market to fixed-income securities. Investors buy bonds, driving prices up and thus depressing yields, which moves in the opposite direction. In concrete terms, the yield on the ten-year Spanish bond fell from 2.4% to 2.3%. Just a month ago, it surpassed the dreaded 3% threshold. In this environment, the risk premium fell again to 106 basis points.
Despite the pressure, however, the stock market managed to limit the declines as much as possible thanks to upward pressure from energy companies, with Iberdrola leading the rise with a 2.4% rebound to keep the price at EUR 10.1 per share. Other companies in the sector, such as Solaria, REE, Naturgy or Endesa were also at the top.
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.
