EUR 100.00 For Business Accounts Only

IBERIAN DAILY 28 MARCH (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ALMIRALL, ELECTRICITY SECTOR, ENAGÁS, UNICAJA.

Caution in Europe
There were no advances made in the peace negotiations between Ukraine and Russia, with the week marked by Powell’s speech and the possible toughening of monetary policies, which led bond yields even higher. Thus, the week ended with drops in Europe of around -1.0% (the US, by contrast, ended in positive numbers), where the best-performing sectors in the Euro STOXX were Basic Resources and Energy vs. the drops in Travel & Leisure and Construction. As for macro data, in Spain the final 4Q’21 GDP was raised to 5.5% YoY and the Govt. reached an agreement with the transport sector for € 1.05 Bn, where € 600 M will go towards reducing fuel prices and € 450 M in direct aid to the sector. In Germany March’s IFO index fell more than expected, due mainly to the expectations component. In Mexico, January’s IGAE activity index rose less than expected. In China, the Govt. has imposed a 2-stage lockdown in Shanghai for its 26 million inhabitants in order to contain the new wave of Covid-19 cases. In Japan, the BoJ intervened on the bond market with large amounts of purchases in order to contain the long-term bonds near the target, which led to a sharp depreciation of the yen. As for Ukraine, this week the two countries will sit back down at the negotiating table, but Zelenski’s demand the territory remain fully intact will not allow an agreement to be reached, although Russia has indicated its interest being focused on Donbas.
What we expect for today
European markets would open with drops of around -0.5% in a week marked by the OPEC+ meeting, the US employment data and the peace talks between Ukraine and Russia. Currently, S&P futures are down -0.32% (yesterday the S&P 500 ended +0.59% higher vs. the European closing bell). Volatility in the US dropped (VIX 20.81). Asian markets are falling (China’s CSI 300 -0.7%, and Japan’s Nikkei -0.6%).
Today in the US we will learn February’s wholesale inventories. In debt auctions: Germany (€ 6 Bn in 6M and 12M bills) and France (€ 5.4 Bn in 3M, 6M and 12M bills).