IPEX 35 loses 11,000 levels over US inflation data

Spain’s IBEX 35 stock index opened Thursday’s session on a negative note after two days, falling from its psychological level of 11,000 points, as investors awaited inflation from the United States and the first round of parliamentary elections in France next Sunday.

Markets were eagerly awaiting US consumer price inflation (Friday at 1230 GMT), which could provide clues as to when the Federal Reserve will cut interest rates after data from Australia and Canada showed unexpected inflation in both countries.

Meanwhile, Fed Governor Michelle Bowman reiterated her stance on Wednesday that “inflation will continue to decline if policy rates are maintained” and that a rate cut will be necessary “eventually” if inflation moves steadily toward 2%.

Key macroeconomic data for the rest of the week include US first-quarter GDP estimates (1230 GMT on Thursday), as well as inflation figures from several European countries on Friday.

Attention will also turn to Thursday’s first US presidential debate, in which incumbent Democrat Joe Biden and his predecessor, Republican Donald Trump, will try to win the support of undecided voters.

Markets were also weighed down by a drop in shares of chipmaker Micron Technology, which fell 8% in after-hours US trading after the company failed to beat sky-high earnings expectations.

“This leaves the market questioning the sustainability of highly concentrated stock market rallies around AI,” Renta4 analysts said in a note to clients.

At 07:09 GMT on Thursday, Spain’s IBEX 35 was down 53.90 points, or 0.49 percent, at 10,976.60, while the FTSE Eurofirst 300 index of major European shares was 0.03 percent lower.

In the banking sector, Santander fell 0.30%, BBVA 0.11%, Caixabank 0.20%, Sabadell 0.34%, Bankinter 0.45% and Unicaja Banco 0.55%.

Among the major non-financials, Telefonica fell 0.30%, Inditex fell 0.92%, Iberdrola fell 0.12%, Celnex fell 0.06% and oil major Repsol shed 0.10%.

(Reporting by Benjamin Mejias Valencia; Editing by Thomas Kobos)