Stock market closes lower

27 November 2007

MADRID – The Spanish stock market closed lower on the first trading session of the week as it was dragged into negative territory by Wall Street due to weakness in financial stocks.

The Spanish blue-chip Ibex 35 had traded above 15,500 points for a large part of the session. However, domestic banks came off toward the close in line with New York as subprime-mortgage blues raised their heads again. While the Spanish banks have scant exposure to high-risk loans, they are being tarred with the same brush as US and other European lenders, which have suffered from the subprime crisis.

The Ibex 35 shed 0.40 percent to 15,330.20 points after trading in a range of 15,294-15,575. The Madrid general index dropped 0.32 percent to 1,661.85 points. Open-market deals in the continuous market amounted to about EUR 4.2 billion. In the rest of Europe, Frankfurt shed 0.55 percent, Paris dropped 1.14 percent, while London was down 1.30 percent.

The highlight of the day’s trading was Iberia, which remained under the cosh after British Airways declined to buy any more of the airline, throwing its takeover bid in conjunction with TPG into doubt. The stock closed down 1.88 percent at EUR 3.14 after a low EUR 3.08. Trading in the shares was suspended mid-afternoon by the National Securities Commission.

Food group Ebro Puleva was up 6.40 percent after a report that UK private equity firm Permira is looking at the company’s books with a view to making a takeover bid.

Among the banks, Santander shed 0.97 percent, Bankinter lost 2.41 percent, while BBVA was off 0.49 percent. Market leader Telefónica gave up 0.23 percent. Gamesa added 2.11 percent after shedding over 7 percent last week.

Subject: Spanish news