Investors flee risky assets as recession fears resurface
The fear of economic recession prevails in the markets and the wave of sales leaves the rebound experienced by the stock markets yesterday as a mere mirage. The Ibex-35 lost 1.5% to 8,172 points, with falls of more than 2% for financial companies.
However, the losses are similar to those of the rest of the European markets, also affected by the heavy losses with which Wall Street closed last night, of more than 3% in the Nasdaq technology index.
In this environment of massive sales, investors flee towards assets considered to be less risky, such as long-term fixed income. And those purchases drive up the price of the bonds and lower their yield, which moves inversely to the price. A movement that makes it clear that, today, the rate hikes to curb inflation are assumed by the market, but not the fear of its impact on the economic recovery.
The interest of the ten-year German bond falls from 1% to 0.91%, while the US bond at the same term yields from 3% to 2.8%. Recession alarms are also pushing down the return on the Spanish bond, which has even lost the 2% level and stands at 1.95%.
The selling panic has also hit cryptocurrencies squarely, with many investors realizing in recent weeks that these virtual assets have ceased to be a diversifying element of portfolios to consolidate as one more risky asset.
Bitcoin sinks more than 10% blowing up all its supports. He has already lost the $30,000 and is now on his way to giving up the $25,000 as well. For its part, the ethereum falls 15%. But the crypto that has suffered the most in recent hours is again Terra Luna, whose value is practically reduced to ashes with a collapse of more than 96% in just 24 hours.
It is true that in the crypto market there are many stories of successful births followed by much faster disappearances. But never before had it happened so aggressively with a 'stable coin', as cryptocurrencies are called that are born under a format of 'tokens' associated with the value of a 'fiat' currency (such as the dollar or the euro), to material goods such as gold or real estate, or to another cryptocurrency.
We will have to wait for the opening of Wall Street to see if the European stock markets maintain the sharp falls of the opening. But at the moment everything indicates that it will be so. Within the national trading floor, investors will have a new batch of extremely important business results that could also mark the future of the day.
At the moment, the market is already listing Telefónica's accounts, with a net profit of 706 million euros until March, 20% less than in the same period last year, but it has managed to grow in revenue in all its markets.
In the raw materials market, the price of oil resumes its downward path with falls of 1% that leave the price of a barrel of Brent, a benchmark in Europe, at 106 dollars, while that of West Texas in the United States is around 104 dollars.