On the 28th, the Spanish have an appointment with the polls. But investors are also very interested in knowing what the reaction of the equity markets will be in the day after depending on the government that may be formed in Spain during the next four years. This factor is causing a lateral movement in the Ibex 35 that is causing it to move in a very narrow strip between 9.100 and 9.600 points which he is having trouble getting out of right now. Waiting for what may happen on the last Sunday of the opening month.
Some stock markets are more sensitive than others regarding the executive that may be formed after the general elections this month. In particular, what they depend on government actions and that they are the ones who are waiting for what may happen on this new election day. Where it is elucidated that there may be a government of one or another sign and with quite different economic policies between them. Something that keeps small and medium investments in expectation.
On the other hand, it cannot be forgotten that Spanish equities depend on the general context of the international stock markets and this aspect of course may be much more important for the future of its future from now on. Beyond other technical considerations and maybe even from the point of view of its fundamentals. In any case, the eye of retail investors is on 28 A to know what to do. Whether to open positions or undo them Faced with an unflattering scenario for his personal interests in his relationship with the always complicated world of money.
Elections: most sensitive sectors
Of course, there are some sectors that will be more aware of the general elections than others and this is evident by the decrease in the volume of contracting in equity markets. One of the most relevant is the bank that is waiting for what may happen on this day. In a general context, in which its values remain in a worrying downward trend in the background. With significant depreciations in all the banks that are listed on the national continuous market and that has led to the price of their shares being frankly interesting, although with the risk that they will continue to decline in the coming days.
In addition, we cannot forget the great influence that the banking sector for the configuration of the selective index of Spanish equities, the Ibex 35. With a specific weight that no other business segment currently has. Unlike what happens in the remaining stock markets of the old continent. In this sense, there will be no choice but to be very attentive to what really happens with these values. On the other hand, they are in a very delicate position and with one of the lowest prices in recent years. Where any attempt to rise is nipped in the bud by the strong selling current.
Regulation of electricity companies
Another of the most characteristic cases is that of light supply companies who are the most interested in knowing the sign the color of the next government in our country. It should be remembered that this business segment is very sensitive to the measures that the next executive may take since it depends on them that they can stay as they are or be harmed in their sectorial interests. While the center-right bloc is more in favor of promoting further liberalization of the sector, eliminating subsidies and the removal of entry barriers. To the point that a much more uncertain scenario would be generated for electricity companies that would have to rethink their business model. A factor that could lead to the price of its shares depreciating in the coming weeks.
While on the contrary, in the other political bloc the response of these companies has been very favorable since last summer. With increases in companies in the sector of almost 30% and that have led some of its values to a situation of absolute free rise. In other words, without any significant resistance ahead and that could take them to even higher levels in their price on the equity markets. As in the specific cases of Iberdrola, Endesa or Naturgy. Although it is also true that they are showing a certain fatigue in the last trading sessions. With little strength to keep going up and with a trading volume that is lower than before.
Pharmacists very attentive
Another sector that is doubtful will be very aware of the elections is the pharmacist, who would gain positions with the electoral proposals, both the PSOE and Ciudadanos. While on the contrary, it would be at a disadvantage with other electoral proposals that advocate eliminating free access to healthcare. To the point that during these days it is showing more volatility than the remaining stock market sectors in the face of what may happen on election day. Not surprisingly, it is very foreseeable that it will be one of the most moving after 28 A, in one way or another.
While on the other hand, it remains to be known what the reaction of the oil companies will be to this political event before the proposal of some political parties of set a diesel tax to equate the price with that of gasoline. Which will undoubtedly determine that the price of your shares goes to one side or the other of the scale. Affecting one of the great blue chips of national equities such as Repsol, which is currently one of the most recommended values by a large part of financial analysts. With a mandate to buy their shares for the medium and long term. On the other hand, generating one of the highest dividend profitability in the market, with an average interest of around 6%.
Strategies to be carried out
Either way, the most sensible thing to do these days is to wait for what might happen on election day this April. So that we can't get hooked in some of the actions that can react more negatively in these elections. At the end of the day there are very few days to know the results and it is not worth risking our available capital for investments. Once this important doubt is resolved, choose to open positions in the most favorable stock market sectors as of May.
While on the other hand, it does not seem that the Spanish stock market is going to move with excessive changes in these days prior to the elections. Thus, the operations in all probability would not be very profitable in any of the business segments that are publicly traded. It does not deserve, therefore, to risk since it is very unfavorable to open positions in these moments since there is more risk of losing money than of winning it. This is a reality that is imposed on small and medium investors who do not know what to do at this precise moment. Where the uncertainty of the equity markets is a reality that imposes its conditions on the stock markets. Beyond the fact that certain rallies may be generated in the prices of the shares of companies listed on the stock market.
The stock market negotiates 34.000 million
The Spanish Stock Market traded 34.680 million euros in equities in March, 7,2% more than in February and 29,6% less than the same month of the previous year. The number of trades grew by 12,5% compared to February, to 3,1 million, 17,8% less than in March 2018. In the exchange-traded funds (ETF) segment, 137,8 million euros were traded , 8,7% more than in February and 38,6% less than in March 2018. The number of negotiations was 5.381, which implies an increase of 16,3% compared to the previous month and a decrease of 34,2 , 2018% compared to March of last year, in XNUMX.
With regard to the fixed income market, it should be noted that in this period it maintained a high level of activity. The cumulative total volume In the first three months of the year it grew by 88,9%, after registering a negotiation of 38.632 million euros in the month of March, 109,9% higher than the same month of 2018. Additionally, the issues admitted to trading increased by 13,8% since the beginning of the year and the outstanding balance increased 3,5%. In a diagnosis of how the Spanish financial markets are doing before the crucial election day this April. While finally, it should be noted that the open position of the set of financial derivatives increased in this period by 2,2% compared to the same month of the previous year. The number of negotiations was 5.381, which implies an increase of 16,3% compared to the previous month and a decrease of 34,2% compared to March 2018.