May 10, 2021

The stock market collapses 4% in the week due to the coronavirus

The Ibex 35 has recorded a weekly fall of 3.98%, which has placed it below 8,400 points, weighed down again by the nervousness of investors before the economic impact of the coronavirus.

The selective Madrid, which in the session this Friday has plunged 3.54%, to 8,375.6 points, accumulates a collapse of 15.28% in the last two weeks. All its values ​​have closed in negative this Friday, with the exception of IAG (+ 1.51%) and CIE Automotive (+ 0.52%). As for the falls, the largest crashes were presented by MásMóvil (-10.71%), Ferrovial (-5.88%), Indra (-5.85%), Arcelormittal (-5.45%), Amadeus ( -5.19%), Acciona (-5.10%), Enagás (-5.04%) and Siemens Gamesa (-5.03%). On the other hand, banks have presented decreases of 2.65% in the case of Santander, 2.54% CaixaBank, 2.22% BBVA, 2.05% Sabadell, 1.87% Bankinter and 1 , 38% Bankia.

In the Continuous Market, PharmaMar titles have boosted more than 15% in this Friday’s stock market session, after announcing that the diagnostic kit of the new coronavirus developed by its subsidiary Genomica has obtained the ‘CE’ certification, thus fulfilling the essential European requirements for medical devices.

The rest of European exchanges have also closed this Friday in ‘red’, with falls of 3.48% in London, 4.14% in Paris, 3.37% in Frankfurt and 3.5% in Milan. This week, of special volatility in the markets, has been marked by the decision by surprise of the Federal Reserve (Fed) of the United States of lowering half the interest rates last Tuesday in response to the coronavirus, a measure that has not achieved Still calm the situation.

In the eurozone, the European Central Bank (ECB) has urged entities to include in their contingency plans the potential risks of a pandemic and the measures to address it in order to minimize the adverse effects of the spread of the coronavirus, including a “urgent” evaluation of the possible implementation of teleworking and the sustainability of operations.

XTB analyst Francisco Sánchez-Matamoros has explained that the fact that the main central banks have moved token in their monetary policy has caused a reaction from investors in the short term: the immediate reduction of their exposure in risk assets such as Actions.

BBVA moved around a hundred workers from its Market team yesterday from the treasury room of the City BBVA to the one it has in Las Rozas as a prevention measure; EY decided that all its employees in Madrid telework and Indra temporarily closed two of the eleven floors of its Roc Boronat center (Barcelona), which will reopen next Monday after applying the relevant hygienic measures.

This Friday, Bankia has confirmed the registration of the first case of Covid-19 coronavirus of an employee of the central services at its headquarters in Madrid, so it has decided to activate its action and prevention protocol and implement teleworking among the 80 workers who shared a plant with the infected professional. On its side, Zurich Seguros has activated a pilot test in which the 400 employees of its buildings in Vía Augusta (Barcelona) and Plaza Euskadi (Bilbao) have worked from home in the ‘flexwork’ format, as a preventive measure for the outbreak. The most affected values ​​are those exposed to the tourism business, such as IAG, Meliá or Amadeus, while the banking sector suffers because the cuts in growth projections in the main economies are generating a domino effect that is lowering the price of money penalizing bank margins, explains the XTB analyst.

Apart from the coranavirus, investors have known the US employment report, which has reflected a contraction of the unemployment rate by one tenth in February, returning to 3.5%, its lowest level since December 1969 .

Oil prices have continued the downward streak which began earlier this Friday before the reluctance of Russia to join the additional cut in the supply of crude oil raised by the Organization of Petroleum Exporting Countries (OPEC) in response to the impact of the coronavirus on the demand for ‘black gold’. Specifically, the price of a barrel of Brent quality oil, a reference for the Old Continent, stood at $ 45.5, while Texas stood at $ 41.93. In addition, doubts in the market have caused refuge assets such as gold “are living a real rally,” says the XTB analyst, as the gold bullion “rises like foam and reaches its maximum of the last eight years.” The Spanish risk premium remained at 90 basis points, with the interest required to the 10-year bond at 0.204%, while the price of the euro against the dollar remained at 1.1317 verdes green notes ’.

Looking ahead to next week, from XTB they expect the stock market to continue to be marked by volatility, moving the Ibex 35 between 8,200 and 8,700 points. “However, we could not rule out that panic took over the bags and caused them to delay their recoil. As long as the shadow of the coronavirus continues to fly over the markets, we will focus on maintaining liquidity or, if we have enough knowledge, develop defensive strategies via derivatives in our stock portfolios, ”said the analyst. Efe


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