Uncertainty after Spanish elections drags down the Ibex-35; stock falls 0.29%

The uncertainty generated after some general elections in which no definite winner emerged hit Spain’s main stock index on Monday, with banks and energy companies leading the losses, as investors waited for a busy week of central bank meetings and business results.

The result of the general elections on Sunday left Spain politically paralyzed, after no party obtained enough votes to form a ruling majority, after the right wing did not meet the victory forecasts given by the polls.

The center-right Popular Party (PP) and voxon the extreme right, obtained 169 seats in the Congress of Deputies, while the Socialists (PSOE), in the Government, and Sumar, on the left, obtained 153, far from the 176 seats needed for the majority.

“The general falls are due to the fact that the market expects either a weak government or an electoral advance“, said Natalia Aguirrehead of analysis of rent 4. “Now a period of uncertainty opens, which is the worst possible scenario for the markets”.

Fiona Cincottastrategist of City Indexhe claimed: “I don’t think it’s necessarily part of a darker long-term outlook for Spain, but I just think right now, we’re seeing that… markets hate uncertainty.”.

As for energy, Goldman Sachs said on Monday that the election result may also spell a temporary setback for the sector in Spain, as the market had recently turned more positive for Endesa and Iberdrola due to “a possible change of government and the prospects of less regulatory intervention”.

The selective Spanish stock market Ibex-35 closed with a fall of 28.00 points on Monday, 0.29%, to 9,543.50 points, while the index of large European values ​​FTSE Eurofirst 300 rose 0.07%.

In the banking sector, Santander lost 0.24%, BBVA fell 0.11%, caixabank yielded 0.55%, Sabadell fell 0.76%, bankinter decreased by 1.23% and Unicaja Bank lost 0.79%.

Among the large non-financial values, Telefónica rose 1.37%, Inditex lost 0.89%, Iberdrola lost 0.48%, Cellnex it fell 0.16% and the oil company Repsol rose 2.74%.

Naturgy advanced 0.07%, after announcing that its profit for the first semester shot up 88%.

Outside the Ibex-35, almirall added 0.35%, after publishing its first half results.

Source: Reuters