Ibex just about maintains 11,000 after third day of losses

The best performer of the day was Banco Popular with a gain of 9.04% to 1.20 euros per share. ABC said that a possible merger between Emilio Saracho’s entity and either Santander or BBVA was on the cards. In addition to Popular, there were significant gains for Mapfre (+1.18%) and Repsol (+0.72%). Bankinter and DIA were the other important winners in a losing session.

The losses side was led by Endesa with a fall of 2.70% after the Norwegian central bank excluded the electrical firm from its high CO2 emissions list. Mediaet (-1.94%) and Cellnex (-1.67%) were the other two lowest stocks, as well as Indra and BBVA.

As well as the bank led by Francisco Gonzalez, the rest of the heavyweights did not have a great day. Iberdrola fell 0.54%, Santander by 0.47%, and Telefonica by 0.14%, while Inditex closed flat. Citigroup analysts consider Inditex as its favourite among lower brand fashion chains. It also pointed to Irish chain Primark as a godo investment option.

European Central Bank President Mario Draghi once again defended the organisation’s monetary policy on Wednesday. According to the Italian, the ECB’s policy is necessary in order to raise inflation. The upturn seen in the first part of the year, he pointed out, does not mean that a sustained increase is necessary.

OIl also keeps grabbing the headlines, without doubt, due to the meeting of OPEC states on 25 May. Brent crude rose 3.43% to $50.41 per barrel and West Texas saw gains of 3.66% to $47.56 after Reuters reported that Saudi Arabia will cut its reserves in an attempt to battle growing production in the US.

State firm Saudi Aramco will reduce its oil supply to Asian consumers by approximately 7 million barrels in June, according to an agency source, as part of an OPEC agreement to reduce production. On Wednesday weekly inventories in the US will be published.

TECHNICAL ANALYSIS

For José María Rodríguez, technical analyst at Bolsamanía, Wednesday saw another corrective session for the Ibex 35. “It closed far from the lows of the day, and it is little more than another consolidation movement after important gains towards the end of April. We see this small hit as coming from the banking sector, which is basically adjusting to those gains. In fact, from the lows of April the banking sector has gained around 15%.”

“Among the blue chips once again there are record highs for Inditex, as well as Repsol. We will be waiting results from Telefonica on Thursday, and if it was able to clear the resistance of 10.63 euros we could see a new push from the Ibex 35.”