Sunday, December 5

Stock markets bounce after sinking Monday on fears of the delta variant boom | Economy

Panels of the Madrid Stock Exchange, last Friday.
Panels of the Madrid Stock Exchange, last Friday.Vega Alonso del Val / EFE

The European stock markets have stopped this Tuesday the debacle suffered on Monday, the worst day in the markets so far this year due to the fear that the increase in contagions will frustrate the expected economic recovery. The European and US stock markets have advanced this Tuesday encouraged by the publication of the business results of the second quarter of numerous corporations, which have revealed better than expected figures: 90% have exceeded forecasts, according to Refinitiv data. The Eurostoxx 50, which groups the 50 main listed companies in the euro zone, has gained 0.65% of its value, while the Ibex 35 has advanced 0.68%.

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One of the first companies to reveal its results this Tuesday has been the European bank UBS, which has reported a profit growth of 63% between April and June, shooting its value on the stock market above 5%. At the other extreme is carmaker Volvo, which has fallen 2.5% on the stock market after revealing that it expects to continue reduced production due to a shortage of microchips.

Companies dependent on mobility and transport have also highlighted this Tuesday, which collapsed on Monday due to the advance of the pandemic. European aircraft manufacturer Airbus has gained 2.1%. The same has happened with the car manufacturers BMW (+ 0.8%) and Volkswagen (+ 1.2%) or the hotel company Marriott (+ 2.5%).

In Spain, the Ibex 35 has almost completely closed positive, except for some loose values. Meliá Hotels has fallen off the rest of tourist values ​​and has fallen by 2%, the worst value in the index this Tuesday. On the other hand, industrial and real estate companies have gained the most. Banks have also advanced.

Doubts about recovery

Despite the rebound of the day, unknowns persist about the economy, which are what led many Stock Exchanges this Monday to register the worst day so far this year. “Global equities experienced a significant decline earlier in the week, driven by a rise in the delta variant [del coronavirus] worldwide, rising inflation fears, which could lead to monetary tightening earlier than expected, and weak credit growth in China, all of which are taking a toll on global growth expectations, “he says. Mathieu Racheter of Swiss bank Julius Baer in a note to investors.

The analyst affirms that the flight to more stable sectors such as consumption and health will continue in the medium term: “We expect the rotation from cyclical and value values ​​to defensive and growth values ​​to continue in the coming months, given the lack of clarity short-term in terms of prospects ”.

For its part, Roberto Scholtes, Strategy Director at UBS, assures that the Stock Exchanges will soon return to their usual dynamics: “As in previous waves, the inflection in contagion in some countries in the coming weeks should be enough for the markets to calm down and look again at the positive economic dynamics and business results ”.

Profits in the main trading floors

In Europe, the rest of the big stock exchanges also closed positively this Tuesday. The French Cac (0.81%) stood out above the rest, although the German Dax (0.55%), the Milan Stock Exchange (0.59%) and the London FTSE (0.54%) also advanced .

In the US, the markets have opened higher, driven by the good results presented by their listed companies. A few hours after its opening, the main stock market in the country, the S&P 500, gained 1.25%, while the Dow Jones industrial index, the worst hit on Monday in its worst day since autumn, did 1.5 %. The Nasdaq technology progressed 1.2%, thus recovering everything lost in the previous day.

Anthony Minopoli, of the advisory firm Knights of Columbus Asset Advisors, subtracts from Monday’s decline and understands that it is part of the market rebalancing: “We have been on a straight line, almost straight up, and the market needs to shake off. Occasionally. The delta variant was an excuse to accelerate some sales yesterday]”, has indicated in declarations collected by Reuters.

The cryptocurrency market has also stood out on Tuesday, although due to its negative evolution: bitcoin has fallen below $ 30,000 for the first time in a month. In the oil market, the barrel brent, a benchmark in Europe, has become 0.6% more expensive and stands at $ 69.

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