At least one of the doubts that small and medium investors in Spain had, the one linked to the general elections that took place this past Sunday, has been cleared up. Where the PSOE has been the winner of the elections, reaching a total of 123 seats, with a support of 28,7% of the voters. While on the contrary, the sum of the center-right parties has fallen far short of being able to form a government. Now it only remains to be resolved if President Sánchez will form a government with the other left-wing parties or if, on the contrary, he will agree with the centrist force of Ciudadanos.
Electoral results that are not affecting the equity markets excessively, except for the stock market sectors that are most sensitive to this political event. As are, for example, banks and electricity companies If they have seen how their prices have been influenced by the result of these elections that have taken place in Spain. The position of financial analysts is not clear either, since some consider that the market is always scared by left-wing governments.
While on the other, there are other opinions that are more neutral in showing that the equity market it will be moved by global factors, not because of the elections. Something that to some extent is normal in a world as globalized as the current one and where international economic constants weigh more in the decisions of investors than the elections of a country. From this general perspective, it does not seem that the elections in Spain are going to have too powerful a specific weight to influence the selective index of Spanish equities, the Ibex 35. If only in the shortest term, that is, in the first days of this week.
Elections: electoral repercussions
During the hours after the results of the general elections were produced, there has been no lack of voices from the large fund managers in which they indicate that the result should reassure the markets variable income. In the sense that a very different thing is politics and a different one is the money sector. Furthermore, it cannot be forgotten that the national stock market has been used to playing with the winner of these important elections in Spain, the PSOE. Yet another compelling reason for very intense and volatile movements to occur in national equity parks.
While on the other hand, it cannot be forgotten on this occasion that these results can help to clear up the doubts that were present in a large part of the small and medium investors. In the sense that it can generate rises when a few days go by and the equity markets assimilate these results. So that in this way, you can get the purchase of the shares at more competitive prices than before, even if their variation is the minimum, as can be seen these days.
The Ibex does not sit well with the elections
On the other hand, it should not be forgotten that the selective index of national equities, the Ibex 35, always has fallen in 100% of the post-election sessions since 1992. But it must be noted that in almost all cases there has been a change of government and this time it has not been this way. If not, on the contrary, it is the same that we had before the elections in our country. And this fact may minimize the declines in the valuation of the shares in the coming days. To the point that they can actually be very insignificant.
From this general scenario, it seems that there is nothing to fear for small and medium investors who should be more concerned about other issues. For example, that the Ibex 35 respects the relevant support it has at the levels of 9.100 or 9.200 points. Because it can be a step for a new downward escalation in Spanish equities. More aware of other bags outside our borders than of the elections themselves. In what is configured as a dominant panorama on the day after this important electoral appointment.
Ibex 35: minimal declines
The selective index of Spanish equities, it seems that it has not been affected by these electoral results. By depreciating just in the day then by a few tenths of a percentage with respect to its price. Something that must be considered as completely normal and within all logic. And most importantly, in line with the trend set by other international squares in our environment. Without there having been any movement of special importance in the formation of prices. Beyond the logical variations in one way or another.
While on the other hand, there have not been more sensitive stock sectors to rise or fall due to this fact of a political nature. That is to say, everything is very quiet for small and medium investors, without it not being useful for their trading operations as one might think at the end of the day on Sunday. Being, on the other hand, a day like so many in the last stock market sessions. With a contracting volume that it must be classified as completely normal for these dates of the year. Beyond other technical considerations and perhaps also from the point of view of the fundamentals of publicly traded securities.
Wait for the negotiations
This placidity in the prices of the stock values is interpreted by the financial agents as a compass of waiting before the negotiations with other political groups and form a government in the coming months. There may be the key to developing some other investment strategy to make the savings profitable in this period of the year. While on the other hand, all investors' glances are directed to more relevant aspects for the equity markets. For example, monetary policy on both sides of the Atlantic. About when interest rates can rise and under what interest these monetary movements will be made.
On the other hand, it should be remembered that the Spanish stock market, and more specifically the Ibex 35, is at a very important moment for its definition one way or the other. And any variation in the conformation of prices can lead to their trend being bearish or bullish. With the strategic implications it has for the operations of small and medium investors. Not surprisingly, at the moment we are facing a scenario of uncertainty and that can harm users from taking some measure about what they have to do in the equity markets.
Reaction in the next few days
In any case, there will be no choice but to be very attentive to what may happen in the coming days, although knowing that the national and international stock exchanges will be closed this Wednesday due to the May XNUMXst holiday. This will be a small respite from what may happen in the following days. Because any turn in the negotiations it can mean a change in trend in equity markets. Beyond the state of its current technical aspect that so far is not bad at all. With all the indexes positive in the first four months of the year, something that a large part of the analysts in these financial markets did not have.
But in any case, there is one thing that small and medium-sized investors are very clear about and that is that they are aware of other things than the development of the government itself in Spain. Where it cannot be forgotten that the next few months will be key to knowing where the equity markets are heading. Both in our country and outside our borders and it will be very relevant to make a decision to take positions in the financial markets or not. In the meantime, there will be no choice but to wait a bit and if anything, carry out some other financial trading operation with great caution. Because the risks are there present and it can make us play a past trick at any time.
Of greater credibility are another series of signals that indicate the opportune moment to buy or sell on the stock market. One of these signals is the gaps, which in a general way, is usually defined as the area or price range in which no operation has taken place. For example, in an uptrend we would say that there is a gap in a daily chart when the low of the lower shadow of one day is above the maximum of the shadow of the previous day. In a downtrend the maximum of the shadow of one day would be lower than the minimum of the shadow of the previous day. In this line, for an upward gap to develop on a weekly or monthly chart, it would be necessary for the lowest level recorded during a week or month to be higher than the maximum reached the previous week or month respectively.