Although the Ibex 35 closed yesterday above 11,800 points, the index has already fallen to 11,500 points and is now playing for that level (it also lost 11,500 intraday). The Spanish selective falls one 2.7%, its biggest daily drop in 2024 and since the banking crisis of March 2023, after the hangover left by Donald Trump’s victory in the US elections in the markets. The indicator trades at 11,514 points, two-month lows. The reverse of the coin is a Wall Street at historic highs.
Acciona is the red lantern of the session – with a drop of more than 7% – but it is not the only one that registers large falls. Sabadell registers a drop of close to 7%, BBVA drops 6.6%, Acciona Energía, 5.9% or Salaria, 4.8%, among others. The biggest victims are energy and banking, the most exposed to possible negative effects after the Republican won. The financial sector has business in the United States and Latin America. This is the case of BBVA in Mexico, where the Republican victory is already priced in the currency pair to the detriment of the Mexican peso.
In addition to the poor outlook for the currencies of emerging countries, the fear is that companies in these countries will be burdened by lower exports and that this would undermine the banking business. In addition, there is concern regarding Trump’s policy regarding renewable energy, since the leader is a climate change denier.
Although the Ibex 35 started the day in the red, the losses have only worsened. However, in Europe the reaction has been different. The main continental indices rose strongly in the early stages of the session, but have progressively moderated, until completely erasing the promotions and returning to sales. The EuroStoxx 50 fell 0.6% to 4,837 points and the Dax fell 0.4% to 19,200 points. The euro is another of the damaged assets and is down almost 2% against the dollar. The European currency is trading at $1.07 and is experiencing its worst session since 2020.
What the markets fear is Trump, since the second-term president of the United States has anticipated a policy in which your country (and its economy) prevails above all else (MAGA, Make America Great Again), which implies tariffs, for example, or lower exports from the euro zone to America.
In Europe, car companies are collapsing. BMV loses 7.4%, Mercedes loses 6.5%, Volkswagen, 5.3%. Again, the fear is that Trump’s prioritization of the domestic auto industry will make competition very difficult for community firms.
The opposite reflection of this situation is experienced on Wall Street. The increases start from 2% and the Dow Jones advances 3% and exceeds 43,500 units, all-time highs. The Republican is going to favor everything or almost everything that has American DNA. The S&P 500 also hits a record high of 5,900. The Nasdaq 100 rebounds 1.7% and is touching levels never seen before above 20,550 points.
In addition to protectionism, the president is expected to carry out a more expansive fiscal policy. That has caused a real collapse in the American bond, T-Note, whose profitability warms 19 basis points, to 4.46%, four-month highs.
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