How are the issues in Spain affecting its stock market?

I would like to talk how the news and the polítical moves affect the stock market. In that case, I will review the consequences of the political riots in Catalonia (Spain). I think it’s been a long story. Catalonia is trying to get the Independence from Spain and they did a referendum last Sunday. This referendum was against the Spanish constitution and this is why the situation is getting worst. This kind of events affects the markets. I like to see how the banking sector is doing in order to measure or get an idea about how a country is doing. Basically, I use them as an advanced indicator of the economy. Please consider that this is a simple analysis, analyzing a bank is really difficult.

As you will see in the charts below all the bank stocks are shrinking.

Banco Santander

    Source: TradingView, Banco Santander

Banco Santander, which is the biggest in Spain and even that a small proportion of its revenue comes from Spain, is being affected by these political riots. It could break the resistance at 5.90 euros and with this situation is difficult to say where it goes but it seems that is looking for the support around 5.40 euros.

BBVA

    Source: TradingView, BBVA

BBVA is the same case as Santander, it’s a big international bank with exposure to different countries and economic areas. It´s been weakening since August. I don’t know if it will break the current support but in case it does, we will see the price around 6.80 euros.

Caixabank

   Source: TradingView, Caixabank

It´s the third biggest bank in Spain but it has more exposure to Catalonia, this is why is falling more than the previous two. It´s breaking the 200 simple moving average, which can be interpreted as a weak signal.

Banco Sabadell

    Source: TradingView, Banco Sabadell

We can see that it has a down trend since August. The exposure to the region has made that the last 3 days has come down aggressively and the volume confirms it.

Bankia

   Source: TradingView, Bankia

The case of Bankia is different. It’s been around the 200 simple moving average for a month. I can see the next support around 3.65 euros.

It’s difficult to predict the movement of the stocks when certain events happen in the market. I will try to create a statistic model and share with you in the future.

Disclaimer

I wrote this article myself, and it expresses my own opinions that shouldn't be used as a trading advice. Trading carries considerable risk due to the high leverages involved