Summary:
- Spanish stocks tumble as pressure grows on Rajoy
- 2 parties threaten to issue vote of no confidence
- Euro also drops with EURUSD hitting fresh lows
It’s shaping up to be a pretty ugly day for Spanish investors with the SPA35 plunging almost 3% on growing political disruption in Madrid. Spanish PM Rajoy is coming under attack on two fronts with the opposition Socialists and the centre-right Ciudadanos both issuing him with an ultimatum that if he doesn’t call snap elections then they will be ready to put forward a motion of no confidence.
SPA35.cash has experienced some largescale selling today as investors rush for the exits amidst growing political uncertainty. The market plunged almost 300 ticks in just 2 hours Source: xStation
Politics has been a big driving force on the Spanish markets over the past year or so, with the Catalan independence situation seeing some wild swings back in September/October. Rajoy has seemingly come out fighting in this latest battle, calling a press conference and delivering the following comments:
- No-confidence motion is bad for Spain’s interests
- Will not call a snap election
- No government member was among corruption convictions
The key takeaway here, is that it appears to be that Rajoy will resist these calls for a snap election. Despite this the market is clearly not convinced that this will be the end of the matter and the SPA35 remains firmly lower on the day.
Today’s is setting up to be the largest decline for Spanish stocks in months and will rival some of the big down days we saw back in February. Source: xStation