Foreign investors take possession of Spain’s stock market

Luis Torralba | valenciaplaza.com | Foreign investors have strengthened their grip on Spain’s stock markets during the credit crunch era. They are mainly large financial institutions like global banks, asset management firms, hedge funds and insurance companies, who have become the biggest owners of Spanish shares.

The operator of financial markets in Spain, BME, released information about its 2011 economic exercise and said foreign ownership of Spanish stocks has been increasing during the past 13 years but spiked in the last three.

The rise rate since 1999 is 118.8 percent. “The data shows that non-resident investors represent the majority of participants in the Spanish stock market, but we must remember that domestic investors make up a 21 percent, which is higher than the European average,” BME noted.

A study on stock ownership in European markets by Federation of European Securities Exchanges indicated that Spanish participants in Spain’s stock markets were some 6.1 percent more than elsewhere in the European Union.

Brokers in Madrid said to The Corner that domestic investors have even expanded their presence in the equity market since the crisis began in 2007, although with moderation. The stocks of the Madrid listed companies are held, too, in a much lower degree by collective investment institutions (5 percent) and public administrations (0.3 percent).