Ibex 35: Potential of 15% in a Volatile Market

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Amid global volatility, the consensus of market analysts show confidence in the Ibex 35, with only 8% of recommendations to sell, the lowest figure in two decades. Despite recent corrections, more than 58% of recommendations suggest buying, and the index has upside potential of 15%, according to Bloomberg and FactSet. The Ibex 35 reached 11,476 points in June this year, accumulating a rise of 11%, making it the second most bullish index in Europe, behind the Italian Ftse Mib. Although political uncertainties and the disappointing results of the major technology companies have affected global markets, these declines are seen as buying opportunities.

Among the best recommendations in the index are Sacyr, Logista, Puig, IAG and Acerinox. Sacyr leads with a dividend yield of 4.4% and a 2.4% increase in half-year net profit. Logista, at all-time highs, has a dividend yield of 7.6% and a record ebitda of 485 million euros is expected in 2024. Puig, a recent addition to the Ibex 35, has an upside of close to 20%.

Despite the current political situation in Spain and the high level of unemployment, Ibex 35 could reach between 11,875 and 12,000 points as long as it maintains the most consistent support in the area of 9,800 points and the supports above 10,000 points are not broken.

If we look at the chart, the current trading zone is located between 11,195.46 and 10,931.36. We have to see if the support at 10,825.94 points can hold and allow the Spanish differential to push upwards. On the other hand, the RSI is currently at 49.92% with no strong trading volume since the end of June where the strength in the market was reduced. On the other hand, the Check Point (POC) is located at 10,100 points, so it is quite easy that if the volatility of sellers increases, the market will pull back strongly.

Ion Jauregui - Analyst Activtrades






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