A very optimistic beginning of the year and more if one takes into account that there are still many open fronts pending resolution. Although the uncertainties are practically the same as a month ago, in January investors chose to take advantage of the liquidity of the beginning of the year and the attractive valuations to take a position in equities. The Ibex 35 has been one of the big beneficiaries and in the absence of two sessions for the end of January, the selective adds 6.78%, a rise that leads it to sign its best start to the year since 2011, when it rebounded a 9 , 6%. But the promotions are not there. From the December lows, the index advances 9%.
Sergio Ávila, an IG analyst, points to investors' greater predisposition towards risk as one of the reasons that justify the rebound. The final stretch of 2018 was marked by an extreme fear that accelerated the losses, leaving many quoted with very attractive valuations. "To this have been added the expectations of a commercial agreement and the greater sensitivity of the central banks to the evolution of the markets", affirms Natalia Aguirre, director of income strategy 4. With these ingredients, the recovery of the Spanish stock market is headed by firms strongly punished in 2018 as Mediaset (up 14.75% this year) or quoted taking advantage of the approach of the positions between China and the US as Cie Automotive (12.87%) or ArcelorMittal (9.90%).
Along with the Spanish Stock Exchange, the other major beneficiary of investors' greater appetite for risk is the Italian MIB, which rises by 7.52% in 2019, in line with the 7.57% rebound it experienced in January from last year. In the final stretch of 2018 Rome and Brussels managed to sign peace. After three months of tensions on account of budgets, both sides gave their arm to twist and avoided the dreaded penalties for excessive deficit after Italy lower its forecast to 2.04% from the initial 2.4%. "At the end of the year it was possible to calm the political risk in Italy and that is how the market has picked it up. However, if the Italian executive road map is not followed, political tensions will reappear, "explains Aguirre.
More modest are the promotions scored by the German Dax or the French Cac, which advanced by 6.25% and 4.17%, respectively. That is to say, the best start to the year since 2015 thanks, to a great extent, to the messages sent by the Fed that would be willing to stop the rate of rate increases, an idea that investors expect to be confirmed at the meeting. from today.
Analysts believe that there are still reasons that support the comeback, but do not rule out a correction in the short term to consolidate levels. Continuing the uptrend will depend a lot on binary factors. That is, as one outcome or another occurs, the result may be large increases or, conversely, sharp declines. The commercial war or the Brexit are the great threats to the future of the markets. A failure of the negotiations between the US and China would accelerate the slowdown of the economy and the business results that already in 2018 suffered from protectionist policies. In this scenario investors would rush to put their money safe. The same thing happens with an exit from the United Kingdom of the EU and although until the moment the investors discard a hard Brexit, all the possibilities are on the table.