Renta 4’s Francisco Jorro: “Ibex should recover after summer”

imagen43374pFrom | Francisco Jorro, director in Valencia at Renta 4 Banco, said in a conversation with that the ECB's rate cut had already been anticipated by the markets, but the move could still help growth plans in the euro area.

What did you think of the ECB's decision? The truth is that a quarter down of a point was already discounted by the markes. Hence, not only the Ibex did not rebound but actually fell. Yet, this interest rate cut in Europe is historic because for the first time it is below 1%. In the penultimate meeting of the ECB, June's, Mario Draghi himself had already mentioned. And we think this is a gesture of good monetary policy to help the future growth of the euro zone countries.

What stocks could we find in ​​the model portfolio of Renta 4? Today, the 'Big 5 Portfolio' of Renta 4 is composed of Telefónica, Santander, Repsol, Iberdrola and Tecnicas Reunidas. Our selection follows the criteria that, in the current economic climate, one must go for compan

ies with recurring cash flows and high dividend payments.

What guidelines would you give to all those investors who are unclear about whether to invest before the  summer holidays or leave quietly and do it afterwards? We would advise them that after the drops the Ibex has suffere, they focus especially on listed on the Ibex 35, the ones with a high dividend yield and that trade at a discount. The scenario has somewhat changed, since there is less volatility in financial markets once we had the results of the elections in Greece, which finally was able to form government and dissipated the doubts of a Greece outside the euro. In addition, the recent European summit brought positive developments over the matter of the restructuring of the banking sector.

By the way, do you forecast a 'hot summer' in the markets? Historically, summers, especially August, have been less active months for stocks and, therefore, mean less turnover. However, there are always exceptions, such as last year's. Anyway, we still may see bad news from the standpoint of micro and macro, although we are confident we'll witness a progressive recovery of the Ibex, even if in slow motion, in the second half of the year.


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