Stock Market Up, Treasury Yields Rise to 3%

After some doubts in the early stages of the session, the Ibex 35 index closed on Tuesday at 8,715 points, with an improvement of 0.24 percent. The most courageous value has been Unicaja, which has experienced a bullish earthquake at the start of the year. It has appreciated close to 20 percent in just seven sessions.

Significant increases today also in the other banks, in Telefónica and in Naturgy after learning that the Australian fund IFM has increased its stake in the capital of the former Gas Natural. It already reaches 14 percent. Earnings also in the airport manager Aena. It has reported that traffic at its airports has recovered 88 percent in 2022 compared to the previous year, with more than 243 million travelers.

Today investors have digested without great problems the intervention made by Jerome Powell, the president of the Federal Reserve. There have been no big surprises. At a bankers’ convention in Sweden he has reiterated his commitment to the fight against inflation, even though this could lead to a severe slowdown in the economy. Powell has argued that price controls may require unpopular but necessary measures. Some members of the Reserve believe that the next rise in interest rates could be a quarter of a point (instead of the half point that was considered until now), provided that the US CPI – which will be known on Thursday – brings encouraging news. . The next meeting of the US central bank is scheduled for February 2.

On this side of the Atlantic, the European Central Bank continues to defend the need to continue raising the price of money for as long as necessary to return the inflation rate to the 2 percent target. The latest known data shows that inflation is currently in the euro zone at 9.2 percent. The European Commissioner for the Economy, Paolo Gentiloni, believes that the contraction of the economy of the Old Continent in this first part of the year will be less severe than previously feared.

Raising of EBC

Experts from the Goldman Sachs business bank believe that the ECB will raise its interest rates by half a point at each of the meetings on February 2 and March 16, to reduce the rate of increases to a quarter point in his advice of May 3. They believe that the European monetary authority will take the price of money to 3.25 percent. Goldman Sachs estimates that economic activity will be weak in the euro area during the first quarter, but without reaching recession.

Today the Treasury has resolved the first of two debt auctions this week. You have placed letters at 6 and 12 months. The public treasury has entered today 4,894 million euros, after receiving a bulky demand of about 10,000 million. The Treasury has had to assume a higher financing cost. The yield on six-month bills has risen from 2,092 to 2,599 percent, while the yield on one-year paper has gone from 2,474 to 2,998 percent, which is its highest level since mid-2012. Bonds will come on Thursday and obligations with different maturities with which it expects to attract up to 7,250 million euros.

The price of oil has moved with great instability in recent days. The reopening of China pushes prices up, but fears that contagion will cool the economy prevent a sustained rebound. A barrel of North Sea crude, which yesterday exceeded 81 dollars, is now being paid again below 80. In currencies, the dollar loses strength against the euro. The European currency is exchanged this afternoon clearly above 1.07 dollars. For its part, gold is trading at $1,880 per ounce. It is its highest level in the last eight months. Analysts do not rule out reaching higher prices.

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