Our Market Analysis : 23/12/2017

The week was slightly positive on equity indices this week, with a 0.28% increase for the S & P500 and 0.55% for the STOXX600NR.

This week was especially marked by the elections in Catalonia which saw the Unionists get the majority of the votes but the three independentist parties meet the majority in parliament. However, the three independentist parties are not on the same strategic line and the region may be difficult to govern. The question of Catalan independence is therefore far from closed, but risks being on the longer term and could be forgotten by the markets for some time.

IBEX resilient enough (LYXIB) : weekly data

The week was slightly positive on equity indices this week, with a 0.28% increase for the S&P500 and 0.55% for the STOXX600NR. This week was especially marked by the elections in Catalonia which saw the Unionists get the majority of the votes but the three independentist parties meet the majority in parliament. However, the three independentist parties are not on the same strategic line and the region may be difficult to govern. The question of Catalan independence is therefore far from closed, but risks being on the longer term and could be forgotten by the markets for some time.

The US Oil sector surged (IEO) : weekly data

The adoption of the tax plan had a significant impact on 10-year US long-term rates, which rose by more than 10 basis points to 2.48%, reflecting inflation fears.

Another highlight of the week, the sharp fall of bitcoin against the dollar, which lost about a third of its value during the week. The continuous rise in bitcoin since the summer seems like a major bubble in the sense that there is no guarantor (central bank) or underlying (like the US economy underlying the USD), for cryptocurrencies even if the technology seems disruptive and could eventually impose itself with central banks and financial markets later on.

The euro rose against the USD this week and is close to 1.19 despite rising US rates and the Catalan elections.