Spain Finance & Business - Monday January 21 2008

Spain Finance & Business - Monday January 21 2008
larger | smaller
By h.b. - Jan 21, 2008 - 2:20 PM

Archive Photo of the Madrid Stock Market - EFE

Markets panic over concerns of a recession in the United States

It’s turning into a black Monday on the Spanish stock market today with the IBEX 35 index down by 7% at mid-session, although recovering to 5% later in the day. The fall comes in common with all the main European markets as a mood of scepticism takes over the traders regarding the measures announced by President Bush over the weekend designed to reactivate the United States economy. Bush has announced tax rebates to middle income families as a way of stimulating the economy, but the markets are not impressed. The Nikkei showed losses of 3.8%, most European markets were down by 5% or 6% and here in Spain falls of as much as 7% have been seen, in what makes it the largest fall in trading here since 2001 and the attack on the twin towers in New York. It means the Madrid market has lost the 13,000 level and lost all of its gains seen last year.
Curiously one bright spark has been the troubled Colonial real estate firm which saw shares rally by 6.7% after trading in the company resumed at noon. It comes on the news that the United States giant, General Electric, is interested in buying them out.
Shares in the company recovered by nearly 7% as they returned to the market at noon today. GE says however that they want to inspect at the financial, fiscal, legal and business information of the company before making a final decision.
There is another bid mentioned to be in the planning, from the Gecina company, but most observers comment it is only a project at this stage. Colonial president and main shareholder, Luis Portillo, resigned from Colonial after shares fell 42% in a couple of days last year, after he decided to sell his stake.

Largest losses here have been seen by Repsol, down 11% and the construction group Sacyr, down over 9%.
Some traders have commented that Europe is anticipating a fall on Wall Street when the market reopens there tomorrow; today is a Bank Holiday in the United States.

Another knock on effect by the fall in the construction sector in Spain is the loss of jobs among electricians and plumbers across the country. Their professional associations have warned that the effects of the slow down are now being noticed, and has warned that many of their workers have been spending 60% of their time on newly built property. Job losses will be unavoidable.

The Director General of the Caixa Catalunya bank, Josep María Loza, has announced his resignation after more than ten years in the post. He admitted that he had brought his decision forward as he saw this year as a difficult one in which important decisions would have to be made, and said he was going for personal and family reasons. It’s not yet clear who will replace the 59 year old.

Some good news – The number of deaths in the work place last year was 841. It means that the largest reduction in numbers in ten years, and comes thanks to an increase in safety inspections. The fall is 11.2% down on the numbers for 1006.

Rural Tourism in Spain has increased by 93% over the past five years, and 89% of the travellers are native Spaniards. It means that more than two million tourists a year head inland away from the main destinations of sun and beach. Average stay on such a trip is only three days however, according to the numbers from the Institute of Touristic Studies who looked at occupancy data across the country. That’s explained by many of the trips being taken inland when it is a Puente long bank holiday weekend.

The Government has given permission to the Spanish Blind Organisation ONCE to sell their lottery ‘cupón’ over the internet from April 1. Upto now only the official state lotteries have been granted internet access in Spain, and a statement from the Ministry for Employment and Social Affairs said the measure was being taken so that ONCE could increase their income, so they can spend more on social projects and aid.

Click here for related stories

mobile |

email this article | print

printer friendly page

More Spain Business

Readers' comments:
Please keep to the subject. Opinions published here are of our visitors, not the Typically Spanish team. Comments which go against Spanish laws or which are libellous are not allowed. We reserve the right to delete any comment we wish. Placing a comment indicates you have read our terms and conditions and privacy policy.

Por favor, céntrate en el tema. Son las opiniones de los internautas, y no las de Typically Spanish. No está permitido verter comentarios contrarios a las leyes españolas o injuriantes. Reservado el derecho a eliminar los comentarios que consideremos fuera de tema. Escribir un comentario indica que has leído nuestros condiciones de uso y politica de privacidad.