Spanish stocks continue to be the losers in Europe

Spanish shares missed the strong rally in European stocks on Friday after the regional parliament vote in Catalonia for independence. The news deepened the country's political crisis, and the market reaction was a -1.5% loss for the Spanish benchmark Ibex 35.

Catalunian banks remain the biggest losers, with only Banco de Sabadell falling by 4.9% and CaixaBank by 2.7%. IAG, an English-Spanish airline, was the biggest loser among airlines, down 6.3%. Meanwhile, the group's shares in London led the FTSE 100 dropped, sinking 6.9%. Shares of the company, which owns Iberia and British Airways, declined on Friday after declaring disappointing results for the third quarter, but fell even further after the vote on independence.

"As the markets remain convinced that the current crisis will not jeopardize the Spanish state, the negative reaction on the bond market must remain limited," said Stephen Triptic of ING Bank.

Already weakened by the ECB's decision to continue to buy bonds for most of the following year, the euro has further fallen from the Catalan vote. The single currency fell 0.6% against the dollar to a quarterly bottom of $1.1585.

Currently, mass protests are taking place in the area, with market participants expecting tensions in the country to remain until the preliminary elections scheduled for December are over. Until then, we remain short on Ibex 35 and we use any correction for new short positions.

Source: Financial Times

Jr Trader Petar Milanov

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