Rebound. European stocks skyrocket on Tuesday in hopes that politicians in Europe and the US will realize the long-awaited fiscal bailouts that society and the economy need to combat the coronavirus ‘shock’. After opening, the IBEX 35, the Spanish reference, shoots a 3.5%, up to 6,400 points, somewhat below the 5% increases recorded by the Dax german the Cac French or Wall Street Index Futures. The main squares in Asia have ended the session with strong increases in both Tokyo and Seoul.
Among the main movements in the Spanish market, the 3.6% rise in Santander Bank after the suspension of its dividend in 2020 to strengthen its ratios facing the wave of loans that will have to face in the current crisis. It also rises slightly more than 3% Caixabank or 4% BBVA and another 5% Sabadell. The climbs are generalized with a prominent place for Arcelor (+ 9%), Cie Automotive (+ 8%) or Mapfre (+ 7%). The actions of IAG register high volatility after a rough session start with auction included and they rise 6% although they have gotten to fly 14%.
“The possible agreement in the US Senate for the approval of the economic aid plan, which seems closer and closer; and, to a lesser extent, the news that the The Trump administration is thinking of lifting some of the toughest restrictions in the areas of the country least affected by the virus, being more selective also in the application of the same, when directing them to the population of greater risk such as the elderly and those who present complex pathologies, “the analysts of Link Securities.
Thus, in the first bars of this Tuesday’s session, all the securities were trading in green, led by ArcelorMittal (+ 6.93%), Mapfre (+ 6.02%), Acciona (+ 5.05%), Melia Hotels International (+ 5.02%), Sabadell (+ 4.99%), ACS (+ 4.95%) and Repsol (+ 4.31%). Investors will also pay attention this Tuesday to the meeting of the ministers of Economy and Finance of the euro zone (Eurogroup) in which they will explore new ways of responding to the economic consequences of the coronavirus while increasing the voices calling for the launch of Eurobonds and the participation of the European rescue fund.
Another focus of reference is in the Chinese city of Wuhanfocus of the epidemic of the coronavirus, has decided to lift restrictions on travel on next april 8 after more than two months of confinement, a measure that was imposed on January 23. Added to this is the decision of the United States Federal Reserve (Fed) of buying unlimited assets for as long as necessary.
“Within the US Government, the opinion is being imposed that the ‘applied remedy could be worse than the disease’, and that the economic cost of the isolation measures could be unbearable, something that we are sure is going to generate a huge political controversy in the country, “they add. In this sense, the spread of Covid-19 is growing at full speed in USA in recent days and its number of cases has already surpassed countries like Spain.
For its part, the price of a quality barrel Brent, a benchmark in Europe, began the day on the rise until reaching 27 dollars, while the West Texas Intermediate (WTI), a reference for the United States, was trading at around $ 24. Likewise, the Spanish risk premium stood at 110 basis points, with the interest required on the ten-year bond at 0.7%, while the price of the euro against the dollarar stood at 1.0840 ‘green bills’.