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The levels of the Ibex to jump over the 'embers' of the market

  1. Carlos Simon Garcia
  2. Sergio Fernandez

It was predicted that it was going to be a year marked by volatility . Investment banks already warned that they had to have a stomach to assimilate all the scares in the market that could happen this year, marked by a normalization of the growth of companies after the strong momentum of the recovery after the pandemic and by the progressive withdrawal of stimuli that was going to arrive sooner or later, as it is, especially on the other side of the Atlantic.

All these embers can make many investors not dare to take the steps and move in the stock market this year for fear of burning . However, if there is something about embers, it is that you can only avoid getting burned precisely if you move with speed.

In addition to the above mentioned, in recent days the growing warlike tension between Russia and NATO has been added, something to which the stock markets responded with sharp falls at the beginning of the week from which they have barely been able to recover. Situations like these of tension and volatility can happen throughout the year and for this reason it is good to have a clear idea of ​​the levels that should not be lost and also those in which it is more worth taking profits, because despite the fact that the prospects are not ideal, it does not mean that you cannot win in the stock market if you hit the key movements.

This year the Ibex, despite the declines, is the European index that is behaving the best "and this is something that is beginning to attract our attention and that could fit in with the bullish scenario that we have for Spanish equities in the coming months, where I hope that the Ibex with dividends ends up reaching the area of ​​historical highs for 2017 and 2020, up to where there is a potential of 10%", explains Joan Cabrero, advisor to Ecotrader. “This could fit in with an Ibex 35 going for 9,500 points, very close to the target I have at 10,100 points, which is where it was trading before the Covid crash,” he adds. The counterparts at these levels of the Ibex in each value will be the objectives to be achieved in the medium term.

Where to look for the rebound

"This relative strength of the Ibex invites us to think that despite the fact that they are badly given, it could try to resist on the basis of the channel that has been limiting the bearish consolidation phase that began in the middle of last year from around 9,310 points, which currently it runs through the area of ​​8,000 integers and that in the event of being lost, I understand that the Ibex could go looking for the support zone of 7,700 points in the worst case, "warns Cabrero. These levels will be, in each of the values, the respective buying zones from which to look for the rebound .

More in the short term there are also possibilities to move through the market through shorter steps. "This week the Ibex has reached a support to watch out for, such as 8,340 points, and from there it rebounds and manages to recover Monday's fall that began in the 8,700 point zone, which is a resistance whose overcoming depends on the risk being removed . that it does not end up falling to the aforementioned 8,000 points", concludes the expert.

Such is the outlook for investors in this volatile environment that almost a third of the securities within the selective have a spread of more than 50% between their second support and their second call option, based on the prices indicated by the Ecotrader expert, while that the average would be 41%.

Thus, Cellnex and Banco Sabadell would be the two Ibex stocks in which higher returns could be obtained in case of waiting for the second support –28.7 euros per share and 0.55 euros, respectively– with a distance of more than 80% between the most separate marks. In contrast, Endesa and Red Eléctrica Española have the most adjusted entry and exit prices with respect to the closing price of the markets this week.

Back to the textile giant

Thanks to the support of the Goldman Sachs analysis firm, Inditex has its best buy recommendation since the beginning of last year, according to the market consensus collected by Bloomberg. The textile giant is one of the most resistant in the sector, in his opinion, and gives it an upward potential of 34% compared to all the experts who estimate a path of less than 20%. January has meant for Inditex to cut its value on the stock market by more than four percentage points , while it has less than 2% to its first support and should fall 13% to the second step located at 23.5 euros.

Amadeus, like most technology companies on both sides of the Atlantic, has not found its place in the markets due to the influence that the Fed and its decision-making are having on the price of these securities. However, despite the fact that the sector in Europe has fallen more than 10% at the beginning of the year, Amadeus has been the one that has best resisted despite the fact that Friday's losses led it to return to negative ground since the beginning of 2022.

Cellnex is the great punished of the year within the Spanish selective. The 'teleco' has lost more than 20% in the year although that does not mean that the company will be without options in 2022. In fact, if it overcomes the obstacle with the British competition authority to acquire the towers of a competitor in the United Kingdom Kingdom, Hutchison, Cellnex plans could jump to increase its market share in Germany , according to several sources familiar with the market. In fact, the consensus of experts collected by Bloomberg estimates that the company has a potential of over 60% up to its target price of 67.3 euros. Cellnex would have the largest share of the selective (92%) from its second support, according to Cabrero.

The options to tinker with another of the great Ibex firms such as Iberdrola are more limited. The value, which falls 3% in the year, has been on one side for months and only offers a 20% path between the lowest part, located at 9.4 euros, and the objectives to be achieved, in €11.45. In any case, it is a stock that has shown great strength in recent months, with a high dividend (the next one, with a 1.7% return, will be paid this week) and a buy recommendation by the consensus of analysts. .

Banks in the end of rates at 0%

The two great banks of the Spanish stock market have gone hand in hand in these first steps of the year. Banco Santander and BBVA have risen by around 7.8% thanks to the momentum of the last five days and to a favorable environment for entities with the end of the era of 0% rates –although for now it is only in USA-. Thus, the latest news for both banks was concentrated on the other side of the Atlantic. On the one hand, BBVA would have benefited from the growth in loan applications in Mexico in recent months, according to Bloomberg analyst Georgi Gunchev, which would boost the income it obtains in the country, although "the risks driven by the devaluation of the lira in Turkey," according to the expert.

Analysts who follow Banco Santander have focused their attention on the purchase of Banamex, after the announcement of the departure of Citigroup, and in which Santander would be interested in expanding its client portfolio in Mexico. However, high inflation in Brazil (where it got almost a quarter of its income in 2020) could pose a problem for the entity of Cantabrian origin if loan applications in the country are reduced "if the macro outlook continues to deteriorate " , according to Credit Suisse analyst Paloma Zuluaga, which would affect its financial results.

In this environment, both entities offer a potential around 35% if the investor decides to wait without burning the second support to take positions and get rid of the shares of Banco Santander and BBVA in the objective set by the Ecotrader expert in the 3, 7 and 6.7 euros, respectively.

Naturgy, in free rise

The case of Naturgy is somewhat different since the usual retail investors have now been joined by a power struggle between the Australian fund IFM and Criteria that is driving its value upwards, which has gone from the area of ​​22 euros to exceed 28 in a few weeks. The objectives, therefore, have been changing over time and now, the first of them is to once again reach 30 euros per share, where they mark their all-time highs . However, from then on the road is free since it would enter an absolute free rise, which is the most bullish technical situation that exists. As purchase prices, in the short term Joan Cabrero sets 27.5 euros as an interesting area, although not the optimal one, which would fit more if Naturgy goes back to 25 euros from where it would open a potential of 20% up to the aforementioned 30 euros.

Another of the big companies on the Ibex and one of the clear winners of the super cycle starring raw materials is ArcelorMittal. This caused that last year its titles were revalued more than 50% on the parquet. However, this year it is among the most bearish values ​​of the Spanish index with more than a 7% drop. Many analysts see this decline as a great buying opportunity and, in fact, it continues to have the best recommendation of the entire Ibex 35, according to La Liga Ibex by elEconomista, which includes advice from FactSet and Bloomberg. Such is the opportunity that if the investor manages to catch Arcelor in the second of the supports, at 22.65 euros, he could earn more than 46% if he reaches 33 euros where the technical analysis places his great objective.

Finally, Telefónica, which is one of the best firms of the year on the Ibex, with a rise of more than 7% caused by rumors of greater consolidation in the European sector. To obtain a buying opportunity, Joan Cabrero points out that it would be necessary to wait for a correction that would return the share to 3.95 or 3.65 euros, from where it would have a rebound potential of 30% to 4.75 euros, where the analyst Set your big goal.

Market strategy: year of volatility and 'trading'



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