EUR 100.00 For Business Accounts Only

IBERIAN DAILY 19 DECEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: AMADEUS, ELECTRICITY SECTOR, GRIFOLS, TALGO.

Fewer rate cuts in the US in 2025
European stock markets ended with gains ahead of the Fed’s decision of cutting rates by 25bps, as expected. Thus, in the STOXX 600, Technology and Banks (that recovered part of the ground lost at the previous session) were the best performers whereas Food and Basic Resources saw the biggest drops. On the macro side, in the euro zone, November’s inflation was cut one tenth vs. the preliminary data to 2.2%, whereas the core data remained at 2.7% prev. In the US, as expected, the Fed cut rates by 25bps, conveying a “higher for longer” message, with only two rate cuts next year (the survey on the Fed members on interest rate levels -dot plan- shows 3.87/3.375/3.125 for 2025-27 vs. 3.375/2.875/2.875 previously. On another note, the government financing plan did not go through in the end given D. Trump’s new demands, generating new doubts on a possible shutdown. As for data, November’s building permits rose more than expected whereas housing starts slowed down again. In Japan, the BoJ kept its benchmark interest rate unchanged but left the door open to a rise at its next meeting.
What we expect for today
Stock markets would open with corrections after J. Powell’s message of fewer rate cuts in 2025. Currently, S&P futures are down -0.08% (the S&P 500 ended -3.23% lower vs. the European closing bell). Asian markets are mixed (China’s CSI 300 +0.16%, Japan’s Nikkei -0.56%).
Today BoE meeting and EU leaders summit. In the US we will learn the final 3Q’24 GDP, weekly jobless claims, December’s Philadelphia Fed index and November’s existing home sales.