It's the economy, stupid
When sorrows come they come not in single spies but in battalions.
4 January 2008
MADRID - When sorrows come they come not in single spies but in battalions. And it was a host of economic woes on the domestic front that did for the Spanish stock market yesterday as it continued its bad start to the year.
Inflation soared, unemployment rose, confidence sagged and so did the blue-chip Ibex 35, which lost the 15,000-point mark along the way led by market heavyweights, with Telefónica losing 2.00 percent.
It could have been worse if it weren't for opening gains on Wall Street as investors came round to thinking the Fed might cut rates to ward off the threat of recession. US weekly jobless claims fell, while factory orders in November increased.
The Ibex 35 closed down 0.97 percent at 14,856.50 points after trading in a range of 14,769-15,016 points. The Madrid general index dropped 1.04 percent to 1,607.94 points. Open-market deals in the continuous market came to about EUR 4.9 billion.
The rest of Europe fared somewhat better, indicating the problems in the Spanish bourse are mostly domestic in origin. Paris shed only 0.08 percent, while Frankfurt gave up 0.51 percent. London bucked the trend, adding 0.98 percent.
Colonial shares took another hammering as trading in the beleaguered property company resumed yesterday after a three-day hiatus. The stock gave up 13.30 percent to EUR 1.63.
Sacyr Vallehermoso, which led blue chips lower on Wednesday, recovered strongly, putting on 6.87 percent. Fellow builder Ferrovial added 0.47 percent as labour unions called off strikes at its British airport operator unit BAA.
The ill winds on the economic front blew Repsol some good as the oil firm added 0.69 percent after crude moved above USD 100 a barrel.
[Copyright El Pais / Adrian Soto 2008]
Subject: Spanish news