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Spanish stock market down due to British EU membership referendum

Spanish stock market down due to British EU membership referendum

MADRID: The Spanish stock market index Ibex-35 lost 1.5 percent in the week as a whole due to the impact of a likely Brexit on the markets.

“Investors are cautious,” said professor Eduardo Martinez Abascal from IESE Business School, “if Britain leaves (the EU), everybody agrees the index will suffer important losses.”

About this week’s results, Abascal said, “the index fell sharply which indicates Brexit had something to do with it, although today it can be seen some recovery.”

Spain’s risk premium closed at 153.50 points on Friday, which was slightly above the 147.30 points of five days ago. However, the risk premium rose by around 10 points from Monday to Tuesday and climbed to 161 points on Thursday.

Meanwhile, Spain’s 10-year bond interest rate closed at 1.5 percent on Friday’s session, showing no big differences when compared with five days ago.

The index rose 1.98 percent on Friday closing at 8,362 points, up from the 8,199.90 points of Thursday.

Gains registered on Friday could be attributed to the impact of the attack on British Labour Party MP Jo Cox, which led to the referendum campaign in the country to be called to a halt, Martinez said.

But “all in all, the changes registered in the Ibex-35 were not very big, they are normal, sometimes there is volatility,” he said.

“However, if Britain leaves the EU,” he pointed out, “that would be a disaster for the markets, for the EU, for everyone.”