As investors are still struggling to properly price the impact of the coronavirus, volatility in financial markets remains elevated. Risk-on sentiment returned to the markets yesterday, putting pressure on gold. Barring a longer-lasting impact on Chinese growth, we do not expect much more fundamental short-term support from the virus for gold. However, on a longer-term horizon we still see upside and maintain a Constructive view.
Elecnor was awarded the contract in a joint venture agreement with Omani company, Target. The new infrastructure will double the water transportation capacity from desalination plants located in Barka and Sohar (in the north of the country) to the drinking water network, bolstering the supply in the Al Batinah region, one of the Sultanate’s most populous areas.
The Bank of Spain has confirmed that the Euribor rate, the reference index for most Spanish mortgages, ended January at an average -0.253%, compared to -0.263% in December, representing its fifth consecutive monthly rise. Despite this rebound, the market assumes the index will remain in negative territory at least until 2022,given that the European Central Bank is likely to maintain its expansive policy.
Rubén Segura-Cayuela (BofA Global Research) | Spain finally has a government, although with a razor-thin majority. This will be a coalition government comprised of the centre-left PSOE and the far-left Podemos, with the external support of several smaller parties, including Basque nationalists, and the implicit support (abstention in the government formation vote) of the secessionist ERC. The “easy”part of the job is done. The very challenging one, policy-making with thin parliamentary numbers, starts now.
Unemployment rose in January by 90,248 people and the Social Security system lost 244,044 members, the worst figure since 2013, when Spain was trying to emerge from the crisis. All the Autonomous Communities, except for the Balearic Islands, have seen the unemployment rate rise in all sectors except construction, so some Autonomous Communities already have more unemployed than in 2019.
Iberdrola is selling its entire stake in German turbine manufacturer Siemens Gamesa, representing 8.07 % of its share capital. The price for the transaction is €1.1 Bn, which equals to €20 per share, plus a premium of 32%.
MásMóvil remains the exception in a sector marked by low growth rates and high competition. In fact, the company has begun 2020 with two positive pieces of news. On the one hand, the telecoms company is anticipating strong cash generation in 2021, which will allow it to reconsider shareholder remuneration policy. On the other hand, the company has once again been the leader, in January, in terms of client portability in both fixed and mobile phone markets.
Spain was the second country in the European Union to receive the most funding from the European Investment Bank (EIB) in 2019, with €8.96 Bn for 92 projects. This was 6% more than in 2019, the entity’s Vice President, Emma Navarro, explained on Monday during the presentation of the EIB’s results in Spain. The EIB allocation of €2.24 Bn for the fight against climate change, 75% more than the previous year, makes Spain also the second country in Europe in terms of climate financing.
Latin American investment abroad reached 38,255 million dollars in 2018, an amount similar to that of the previous three years. The main investors were Brazil and Mexico, and to a lesser extent Colombia and Uruguay. Latin American Foreign Direct Investment (FDI) in Spain amounts to 40,517 million euros, which represents an increase of 200%, in the last ten years.
The five main integrated utilities operating in the Spanish electricity sector (EDP, Endesa, Iberdrola, Naturgy and Viesgo) invested over 11 billion euros in their activities in this market between 2016 and 2018, according to a report prepared by Deloitte. Of this total investment figure, €1.15 Bn corresponded to R&D&I in those three years, of which almost a third was allocated to electricity in Spain over the period.