Ibex 35 Index hits new annual highs led by Inditex

The IBEX 35 index opened 0.87% higher at 11,385, led by Inditex recording a 4.71% overvaluation. Amadeus shares rose 2.51%, while ArcelorMittal fell 1.97% and Bankinter fell 1.18%.

Yesterday’s Madrid qualifier ended with a difficult day that not only took it back off the year’s highs, but also saw it lose 11,300 points, heavily penalized by the banks’ bad behavior.

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Today, all eyes are on Inditex, which reported results for its first financial quarter that showed a net profit of €1.294 million, up 10.8%. Sales rose 7.1% to 8.15 billion euros. At constant exchange rates, sales growth was 10.6%. In turn, the operating result (EBITDA) increased by 8% to EUR 2,370 million.

As approved in March, the Inditex Board of Directors will propose to the General Meeting of Shareholders to approve dividends of 1.54 euros per share related to the results of the 2023 financial year. This dividend consists of two equal payments of €0.77 per share: the first has already been paid on May 2, 2024, and the second will be paid on November 4, 2024.

In the financial sector, BBVA continues to prepare for an offensive to take over Banco Sabadell, although the process could take six to eight months. The bank, chaired by Carlos Torres, has already asked the ECB for permission to attempt a hostile takeover of Banco Sabadell in such a way that it has already fulfilled all the requests necessary for the operation to proceed.

On Friday, May 24, the organization chaired by Carlos Torres requested permission to submit a takeover bid from the National Securities Market Commission (CNMV), which will check whether the information provided to shareholders complies with current legislation. On Monday it did the same with the National Markets and Competition Commission (CNMC), which will check whether the level of concentration resulting from the resulting structure guarantees competition in the banking sector. For its part, the ECB will check the solvency and sustainability of the business model of the merged bank.

Another major corporate deal under consideration is Taqa’s possible takeover bid for Naturgy (Natural Gas). In anticipation of this operation, the company will repatriate a bond subsidiary worth 6 billion million from Holland, the publication reports. Economist.

Also in the energy sector, Iberdrola, through its US subsidiary Avangrid, signed an extension to its 15-year long-term power purchase agreement (PPA) with US utility CPS Energy for its Peñascal wind farm in the US, increasing it. by another 84 megawatts (MW).

The revised PPA for this project, located in Kenedy County, Texas, will increase the Peñascal-based utility’s wind energy consumption from 77 MW to 161 MW, enough to power approximately 41,000 Texas homes.

In CaixaBank’s recommendations section, BPI analyzes all Ibex 35 banks. It upgrades its recommendation on BBVA from neutral to buy and raises its price target to 11.80 from 10.40, keeping Banco Santander at buy with price. 6.40 euros per share, up from the previous 5.70 euros; Unicaja also remains a buy and they raised their target price to €1.60 from the previous €1.50. On the other hand, they downgrade Bankinter and Banco Sabadell from “buy” to “neutral”.

Analysts at Landesbank Baden-Wuerttemberg price Telefónica shares at €4.70, representing a twelve-month potential of 6.8%.

Intermoney Valores experts decided to maintain a “buy” recommendation for ACS, but increased the company’s target price from 43 to 46 euros per share.

V macroeconomic agenda Today, investors are closely watching the May services PMI data, which is available in Spain, France, Germany, the entire eurozone, the UK and the US. Among the most notable data already published, the Spanish services PMI rose to 56.90 in May, up from 56.20 in April. In the eurozone, the PMI for the services sector, which makes up about two-thirds of GDP, registered a lower level than expected in the final reading at 53.2‹â€‹â€‹.

The world’s largest economy will also publish ISM Non-production and ADP reports on private sector employment. The latter will be especially relevant as it will provide a key clue to what to expect from the May jobs report, which will be released Friday by the Labor Department.

Tomorrow’s ECB meeting is also looming on the horizon. Markets are taking the 25-point interest rate cut for granted, but there are more doubts about the path that Christine Lagarde’s institute will take in the coming months, so investors will be paying close attention to the French economist’s every word. .

Futures on Wall Street are pointing to a slightly bullish open after the Big Three managed to overcome initial punishment to end positively yesterday. However, it was defense sectors other than technology that outperformed, while those classified as cyclicals ended the session lower.

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Tokyo’s Nikkei 225 fell during the Asian session, dragged down by economically sensitive readings following weaker-than-expected US labor market data, while a rising yen weighed on confidence. It ended down 0.89% at 38,490, while in China the CSI 300 lost 0.5%.

In commodity markets, oil prices They are little changed while markets are still trying to digest OPEC+’s decision to increase supplies later in the year and following increases in US crude and fuel inventories.

Benchmark Brent crude in Europe is trading at $77.56 a barrel, while US West Texas crude futures are trading at $73.23 a barrel.

The euro fell 0.02% against the dollar to reach an exchange rate of $1.0876 per community currency.

On the fixed income side, Spanish 10-year yields fall slightly to 3.276%, resulting in a risk premium of 73.3 points over their German counterpart. US 10-year bonds offer a yield of 4.346%.

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