After the poor inflation data, the Ibex lost 8,200 points

Prudence returns to global financial markets after the setback suffered on Tuesday night by Wall Street, where the red numbers prevailed forcefully after learning of a worse-than-anticipated drop in consumer confidence. The latest revision to the GDP of the world’s top power reflects the same sentiment.

In particular, the economy contracted 1.6% in quarter one of 2022. This is one tenth more than the second estimate. It also shows how difficult it is for the Federal Reserve (Fed), to avoid rate increases that could lead to recession.

The weakness in the US Parquet spread to Europe with falls of 1.5% on the Ibex-35. This group lost the barrier of 8,200 point. After obtaining advance inflation data from Spain for June, the falls began to accelerate at the start of the session. They reached 10.2% in maximums in 1985.

Grifols shares' 12% drop on the national trading floor is notable. This is after information suggesting that Grifols may be negotiating a capital increase of approximately 2,000 million euros with different funds. This would amount to almost 20% of Grifols' value.

In a session where the majority of listed banks maintained a positive tone despite the bearish market environment, the BBVA's fall of over 2% also puts pressure on the entity. Yesterday, the entity announced that it would reformulate its accounts in order to reflect the effects of hyperinflation. The bank will lose 324 million euros in profits due to this adjustment.

Investors are closely following the European Central Bank's annual meeting in Sintra (Portugal). Christine Lagarde (the president of the organization) has already stated that fighting inflation is a priority right now and that if necessary the institution will be more aggressive during the new cycle.

However, this forcefulness was accompanied by a message urging calm for the debt markets, and especially the risk premiums from the peripheral countries. Lagarde specifically stated that progress was being made on the anti-fragmentation mechanism and confirmed that bond purchases will commence as part of the PEPP program maturities plan reinvestment plan (launched during pandemic).

Jerome Powell, president of Fed, spoke at the meeting on Wednesday. He reiterated the strength of the economy of the country, but acknowledged that there are no guarantees that the goal of not falling into recession will be achieved.

The raw materials market is experiencing a slowdown in oil prices. A 0.5% decrease in oil prices leaves a barrel Brent crude, which is a reference in Europe at 113 dollars. The American West Texas is currently trading at 111 USD.