Summary of the Madrid Stock Market:
The Madrid stock exchange is one of the four major Spanish stock markets together with those of Barcelona, Bilbao and Valence. These four are included in the ‘Borsas y Mercados Espanoles’ (Spanish Stock markets and exchanges).
The share prices of the largest Spanish companies are quoted on the Madrid Stock Market including some that are highly popular throughout Europe.
The major Madrid Stock Market index:
As with the majority of major European Stock markets, the quote for the Madrid Stock Market is integrated in the calculation of a major stock market index. In this case it is the Ibex 35 index that is composed of the stock market capitalisations of the 35 highest quoted Spanish companies.
It is therefore easier to understand the importance of this Stock Exchange for online trading purposes.
General presentation of the IBEX 35 stock market:
The IBEX 35 is a stock market in the financial sector of Madrid that groups together 35 of the largest Spanish companies under one index name, in much the same way as the CAC40 groups together the 40 largest French companies.
By ‘large businesses’ we refer to those that boast the largest volume of transactions on the Madrid market.
The IBEX 35 was created in 1992 to reflect the general performance of the Spanish economy. For this it takes into account the individual performance of the major stock market capitalisations of the country. This includes major names in Spanish industry such as the BBVA companies or the Santander Group from the banking sector, Iberdrola from energy and Telefonica from telecommunications.
We can therefore say with certainty that the IBEX 35 stock index is a strong indicator of the financial health of Spanish businesses. Of course, the composition of this stock index is not fixed as it is revised every six months by a specific committee composed of experts. It is the ‘Bolsas y Mercados Espanoles’ group that is responsible for this bi-annual revision.
Some historical data about the Ibex 35 market
When it was first quoted, Ibex 35 was worth 3000 points. Since then, the company gained a strong appreciation, during the years 2000 and even managed to climb above the symbolic bar of 12 000 points.
Afterwards, this stock market index which is very popular among investors went through a period of crisis due to the explosion of the internet bubble, the telecommunications sector being strongly represented.
But very quickly, Ibex 35 recovered strength and reached its highest record by scoring 15000 points before finally coming down again to around 10 000 points, particularly because of the crisis in the real state sector that hit the United States in 2008 and which contributed to a fall of the different values represented by this index.
Trading on the IBEX 35 with CFDs:
As with all the national stock indices, the IBEX 35 is a very interesting asset for trading using CFDs.
Given that this index takes into account the economic and financial health of Spain, all the macro-economic data coming from this country should be taken into account when implementing your trading strategies.
We also take into account all the declarations of the country’s leaders on the international field and particularly the European field, which often have a strong effect on announcements and wield a lot of influence on the rates.
Finally, a primordial element for any analysis of the IBEX 35 market concerns the bond interest rates which have been in the spotlight since the beginning of the debt crisis. The latter can serve as an index of confidence for the stock market investors and therefore have consequences for the IBEX 35.