The Ibex moderates the increases and moves away from 8,800 after the US CPI

The Ibex moderates the increases and moves away from 8,800 after the US CPI

Investors take advantage of the respite in the debt market and increase their exposure to equities. In a day in which it was known that year-on-year inflation in the US closed December at 7%, its highest figure since June 1982, the stock markets managed to shake off the downward trend that had prevailed in recent days. With the impulse of the values ​​linked to raw materials and banking, the Ibex 35 scored 0.16%, increases that at intraday levels reached 0.55%, allowing the Spanish selective to momentarily exceed 8,800 points, maximum of November.

The promotions were repeated among their European counterparts. The French Cac added 0.75%; the German Dax, 0.43% and the Italian Mib, 0.65%. At the close of the European markets, Wall Street added 0.3%. Although the level of prices increases the pressure for the Federal Reserve to raise rates, the fact that the data has been in line with analysts' forecasts is enough to relax the selling pressure that the stock markets have been suffering in recent journeys.

In the immediate future, omicron will dictate the fate of the economy, but as Christian Scherrmann, US economist at DWS points out, current indicators confirm that the Fed will most likely be ready to raise rates for the first time in March. since December 2018. According to the latest projections updated in December, the US central bank plans to raise rates three times this year. But every day there are more voices that point to four increments. If these forecasts finally come true, in 2022 the rates will stand at 1-1.25% at the end of the year, levels prior to the outbreak of the pandemic, but still far from the 13-1.25% recorded in June 1982, the last time US inflation hovered around 7%.

The consensus of the analysts maintains that the behavior registered by the Stock Exchanges confirms that the investors had already discounted in previous sessions the new scenario drawn by the monetary policy. Juan José Fernández Figares, director of analysis at Link Securities, affirms that, including interest rate hikes, the Fed's monetary policy will continue to be very accommodative at the end of the year. The expert considers that the volume of liquidity in the market will continue to be high. This "accompanied by a good performance of the economy, favors the behavior of risk assets, in general, and of the stock markets in particular", he remarks.

El Ibex modera las subidas y se aleja de los 8.800 tras el IPC estadounidense

While inflation closed at 7%, core inflation – not including energy or food prices – rose to 5.5% from 4.9%, one tenth less than forecast and the highest rate since years 90. Tiffany Wilding, PIMCO economist for North America, is confident that prices will begin to moderate in the coming months and trend towards the 2% target as they begin to moderate. In addition to the first rate hike in March, the expert expects the Federal Reserve to start reducing its balance sheet at the end of the year, an idea advocated by several members of the institution.

With an eye on the medium term and after Powell was optimistic about the economy and inflation on Tuesday, investors took the opportunity to take positions in debt, an asset that had been oversold in recent sessions. This translated into a drop in returns. Despite the moderation, yields continue to be above the levels recorded at the end of 2021. The Spanish bond closed at 0.63% while the bund closed at -0.06% and the US bond at the same term eased at 1.7%.

Banks and steel companies in the lead

Optimism about the economy provided a boost to commodities. The listed companies linked to these knew how to take advantage. On the Spanish Stock Exchange, ArcelorMIttal (6.45%) and Acerinox (3.21%) were the best representatives. Along with these rises, the profits of banking also stood out, the most bullish sector in Europe so far in 2022. Bankinter advanced 3.15%; CaixaBank, 1.45% and BBVA, 1.84%. Only Sabadell (-0.51%) and Santander (-0.18%) escaped gains.

Among the most bearish values, PharmaMar stood out, correcting 12.88% after rising 18% on Tuesday thanks to the potential of Aplidin against Covid. Naturgy, for its part, lowered 2.17% and Amadeus, 1.88%.