The Ibex 35 falls 4.36% in October, the worst fall since September 2022, but holds 9,000 points

MADRID, 31 Oct.

The Ibex 35 falls 4.36% in October, the worst fall since September 2022, but holds 9,000 points


The Ibex 35 has signed its worst month so far this year in October, falling 4.36%, a bearish intensity that it had not seen since September 2022 - then it lost 6.59% -, although it has managed to hold the level of 9,000 points, reaching, specifically, 9,017.3 integers.

At the same time, despite this monthly decline in which the Ibex has dropped to around 400 basis points, the main indicator of the Spanish market maintains a cumulative revaluation in the current year of 9.58%.

The markets fell sharply in the first week of October, as the perspective emerged that interest rates from the main central banks would remain high for a long period of time.

In the second week, the most important variable of all of October entered the equation: the outbreak of the Palestinian-Israeli conflict after the attacks by the Islamist Hamas militia on October 7 in Israeli territory, while the armed forces of the Jewish country They have recently begun their ground operations in the Gaza Strip.

That week, the markets seemed to ignore the uncertainty of the conflict in the Middle East, although in the middle of the month, and faced with the worsening of the conflict and its potential escalation to the rest of the region, they once again leaned decisively towards losses, until the point that the Ibex is now reaping six consecutive weeks of losses.

All in all, after a last week in which the selective has traded more below 9,000 points than above, it now seems to place its support and resistance level at that level.

On the other hand, October has been marked by the decision of the European Central Bank (ECB) to pause interest rate increases after ten consecutive increases that have taken rates to 4.5% in just over a year; For its part, tomorrow the relevant decision of the US Federal Reserve (Fed) will be known, from which the market expects another pause that will leave rates in the range of 5.25-5.5%.

Likewise, these last hits of October are being led by the business results season, of which XTB expert, Joaquín Robles, pointed out a few days ago that they are "meeting expectations."

In this sense, it is an example that the six listed Spanish banks (Banco Santander, Caixabank, BBVA, Unicaja, Sabadell and Bankinter) closed the first nine months of 2023 with a net profit of 19,761 million euros, which is equivalent to an increase 23.6% compared to the same period last year, according to data compiled by Europa Press according to the quarterly income statements that banks have published in recent days.

Within the battery of macroeconomic data that has been revealed this month, it has been known that the interannual inflation rate of the euro zone moderated 1.4 points in October compared to the previous month, thus reaching 2.9%, which represents the lowest price increase since July 2021, while the underlying rate was reduced by three tenths, to 4.2%.

However, the region's GDP registered a contraction of 0.1% in the third quarter of 2023 compared to the previous three months, which contrasts with the advance of 0.2% in the second part of the year; This is the first drop in quarterly GDP since the second quarter of 2020, in the midst of the coronavirus pandemic.

The Eurizon Asset Management firm has indicated in its monthly commentary that underlying inflation continues to fall in the US and the eurozone, while the rise in oil prices slows the decline in global inflation; while the impact of tensions in the Middle East has been modest to date, although its repercussions on the prices of energy raw materials will have to be closely monitored.

"Macroeconomic data indicate a slowdown in growth in the euro zone, where China's slow recovery weighs on import and export trade, and inflation, still high, slows consumption dynamics. However, there are no signs of a slowdown in the United States, where growth is supported by the labor market and by the restoration of consumer purchasing power thanks to the decline in inflation in the first half," the manager's report added.

On the Spanish side, it has been published that the Consumer Price Index (CPI) increased by 0.3% in October compared to the previous month and kept its interannual rate unchanged at 3.5%, while GDP grew between July and September 0.3%, which is one tenth less than in the previous quarter, while at the same time it moderated its interannual rate by two tenths, from 2% in the second quarter to 1.8% in the third, due to the lower contribution of domestic demand.

Given this situation, the best values ​​of the Ibex 35 at the end of October have been Banco Sabadell (6.41%); Acciona Energía (4.84%); Naturgy (3.65%); Mapfre (1.66%) and Caixabank (1.29%).

On the other hand, the most bearish values ​​in the monthly calculation have been Cellnex (-15.92%); Fluidra (-14.2%); Grifols (-13.91%); ArcelorMittal (-12.02%) and Repsol (-11.21%). Just ahead are components such as Inditex (-7.76%); Telefónica (-5.74%); Banco Santander (-4.21%) and BBVA (-3.74%).

At the close of the session, in the raw materials market, Brent crude oil, the reference in Europe, provisionally depreciated 8% in October, to 87.58 dollars a barrel, although the minimum in the month -83, 44 dollars - was hit the day before the outbreak of the Middle East conflict, on October 6.

For its part, the WTI barrel of Texas fell 10.3% in the tenth month of the year, to 81.4 dollars, the same level it reached before the aforementioned conflict, although last week it exceeded 90 dollars.

In the currency market, the euro remained unchanged at the end of October compared to September, at 1.0573 dollars, while the interest on long-term Spanish debt ended the month at 3.877% after subtracting five points. basic - and that during the month it has reached trading above 4.1% -, with the risk premium (the differential with the German bond) at 107.4 points.