MADRID – With the upcoming regional elections in Spain, the stock market has gotten a huge boast in several departments.
The Ibex, which had fallen sharply on Friday’s independence declaration bounced back with a 2.6% gain on Monday. This saw it reach its highest since August.
Catalan Banks climbed by 4.2% and Caixabank and Aabadell clibed by 5.4% while Spain’s state-owned lender Bankia saw a 2.4% climb after a 10% fall in the third quarter profits.
The improvement in the country’s stock market is believed to have been inspired by the anti-independence rally that was held by the citizens.
“After an escalation of the Catalan crisis on Friday, Spanish markets are in recovery mode at the start of this week.” Says Kathleen Brooks who is the research director at City Index.
The anti-independence rally was held in Barcelona in favour of maintaining an unified Spain and a poll on Sunday showing a small lead for political parties opposed to a split.
Berenberg’s chief economist Holger Schmieding said the economic impact of the turmoil was likely to remain “temporary and muted” though warned that a prolonged stand-off could see economic damage spilling into next year and cautioned against a heavy-handed approach by Madrid.