The political landscape in Spain is constantly in flux, as evidenced by the recent resignation of Prime Minister Pedro Sánchez. Despite this turmoil, the Spanish stock market has remained relatively stable, with no major fluctuations. Investors have shown a preference for conservative, fixed-income products amidst global uncertainties. The risk premium remains low and the debt market has seen minimal impact from recent events.
Investment banks have labeled the political scenario in Spain as “Italian-style” due to its high instability. Business leaders express concern about legal and political uncertainty impacting the economy. Legislative changes, including tax laws and regulatory measures, have created an atmosphere of uncertainty for investors. The international relevance of Spain in the investment landscape has waned, leading to apprehension among fund managers.
The situation in Spain is compared to that of Portugal, where Prime Minister António Costa resigned last November amidst corruption allegations. This led to a 2.5% drop in the PSI 20 index. Notable gains were seen in certain companies like Banco Sabadell, which reported an 8% increase in quarterly results during a recent session where the Ibex 35 closed slightly negative below 11,000 points. Despite this noise, the market seems unfazed and continues to stay on the sidelines while investors focus on conservative investments amidst global uncertainties.
