Tourism and banking lead Ibex to nearly 8,900 | markets

the European stocks Continue to rise in the last session of the week, encouraging after data US Consumer Price Index, which eased for the sixth consecutive month. Today the market is interested in the “unofficial” start to the earnings season in the US with the accounts of some of the major banking entities in the country being shown.

It was previously reported that the UK’s GDP grew by 0.1% in November, compared to an increase of 0.5% in October, due to a rise in the services sector. In Spain, The National Institute of Statistics lowers inflation in December to 5.7%, due to cheaper fuel and electricity prices.

After starting in small increments, the IBEX 35 Accelerates and adds nearly 0.8% thanks to tourism and banking values. Selectivity managed to be around 8,900 points and be at the highest level since the end of last May. Within Spanish selectivity, IAG, CaixaBank, Santander and Amadeus score more than 2%. Among the falls, Sacyr marked a decline of 0.8%. It was followed by the colony, which fell 0.6%. Iberdrola and Inditex, two heavyweights on caribou, are also red.

In Europe, within the Stoxx 600, technology companies, banks and the pharmaceutical sector led the gains, with increases ranging from 0.8% to 1.3%. On the flip side, the auto sector fell relatively strongly declining by an average of 2%. VolskWagen, Stellantis, Renault and Volvo are among the worst values ​​in the session.

Wall Street closed overnight in the green in a positive reaction to lower inflation in the US last month. The CPI continued to decline year-on-year in December, for the sixth month in a row, and came in at 6.5%, six-tenths lower than in November. Core inflation fell three-tenths of the annual rate, to 5.7%, but rose by one-tenth in the month.

Carlo Botti, head of sovereign fixed income investment at M&G, reflects on the data. “This is another encouraging sign that inflationary pressure is easing in the US. Real estate prices continue to ease, as do essential services, with the exception of rents. And in the case of the latter variable, it will likely also reduce its inflation in the coming months.”

For the expert, the key will be what will happen in the near future. “Looking ahead, inflation will likely continue to fall, but the key question is where it will end up. Deglobalization will certainly tend to keep the cost of goods above pre-COVID levels, while higher employment will raise wages and as a result It will also lead to higher prices for essential services.Pouti predicts that getting out of the peak of inflation is the easy part, and getting back to the 2% target will be more complicated.

In general, many investors hope that lower inflation will lead the Federal Reserve (Fed) to ease its aggressive policy of raising interest rates, as some analysts fear that it will lead to a recession if there are no changes. . Market reports from entities such as ING, Federated Hermes and Pimco are betting that the Fed will adjust its rate hike by 25 basis points at its February 1 meeting.

In fact, Pimco goes even further and is already offering that in the second half of 2023, the Fed could start talking about cutting interest rates again. “It is possible that the UK is already in a recession. We expect the Eurozone to follow next.” The US and Canada will enter recession later in the first half of 2023. We expect central banks in developed markets to continue to raise interest rates during this quarter or so. As 2023 progresses, inflation will decline and unemployment will increase, and the need for tougher policy will be less clear. Since the United States appears to be leading inflation trends in developed markets and that inflation may decline faster in the United States than elsewhere, the Fed may be the first central bank to discuss interest rate cuts in the second half of 2023,” Tiffany elaborated. Wilding W Andrew Bowles, economist W Director of the Pimco Periodic Forum and CIO of the entity’s global fixed income, respectively.

Today the market is interested in publishing the quarterly and annual results of four of the country’s major banks: JPMorgan Chase, Bank of America, Citigroup and Wells Fargo.

In Asia, the yen hit a seven-month high against the dollar, trading at 128.62 yen amid signs of slowing US inflation and rising Japanese bond yields. The Tokyo Stock Exchange fell 1.25%. The Shanghai Stock Exchange gained 1.01% and the Shenzhen Stock Exchange gained 1.19%.

In the raw materials market, Brent oil, a benchmark in Europe, fell 0.2% to $83.86 a barrel. For its part, the euro is trading slightly lower against the dollar, to 1.0836 “dollars”.