Making judgements on “whether a market is expensive or cheap,” using aggregates of prices and earnings, is a very risky simplification. To begin with, there are companies which don’t make money or even lose it, and quite a lot of it. Responsible, professional investors don’t buy stock markets indices, they buy shares. They don’t invest “top-down” but rather “bottom-up”.
Investors realise that the political risk in France has decreased substantially and are less concerned about what might happen on the political front in Italy and Germany. Now it’s time to look at companies’ fundamentals once again and continue to focus on the ECB’s decisions over the coming months.
The Spanish equities market saw a turnover of €652.907 billion in 2016, a decline of 32.1% from a year earlier. The fall is in line with the general decrease in volumes registered in stock markets across the world. In December, trading volumes fell 27.5% to €48.987 billion from a year earlier.
Most analysts believe the recovery in the stock prices of Spain’s four big Socimis will continue over the coming months. Between 70% and 80% of all brokerage houses have a buy recommendation. The fact these property investment vehicles have quite high returns and there is very little competition are amongst the positive factors.
The main US stock indices (S&P 500 and the Nasdaq) are at record highs while the European bourses have lost over 10% in the year to date. And that’s despite the fact that they recovered almost all of their ‘Brexit’ losses in July. Such a disparate performance is not because US corporate profits have been better, as you might expect, but is due to other factors associated with more solid economic growth, a healthy jobs market and inflation-related gains.
José A. Santos (Patrivalor) | The value of the 60 Spanish companies listed on the stock market stood at 536.499 billion euros at end-July 2016, down 9.0% from end-2015, Patrivalor says.
Fernando Rodríguez | Telxius Telecom, Telefonica’s new telecommunications’ infrastructure subsidiary, will build and manage Marea, the subsea cable across the Atlantic that Facebook and Microsoft will run from Virginia Beach in Virginia to Bilbao in Spain. The announcement comes at exactly the right time as Telxius’ IPO is about to happen on 2nd June. Analysts consulted by The Corner believe this will go down well with investors. It will also be a companion for Cellnex Telecom, as another representative from this sector in the Spanish stock market.
Nearly 5 months of 2016 have passed and, after flirting with the 10,000 level, the Ibex 35 index closed at 8,700 last week, accumulating a 9% drop over the year so far. This shows that the stock market has become the most reliable expression of the lack of confidence in the world of money, although confidence is a concept which is too intangible and a mix of factors which are often not very solid.
Deutsche AM | Volatile stock markets trending sideways. Ultra-low interest. This is hardly the stuff investor dreams are made of. Under company’s value and what is already priced in.
In the last few months, three leading Spanish companies, Parques Reunidos, Telepizza and Cortefiel, have announced plans to list on the stock market. This wouldn’t have been so odd if it weren’t for the fact that the trio were already in the market some years ago, and were then later delisted.