IBEX 2015: The Rally Defined by Greece and Draghi

IBEX 2015: The Rally That Hung in the Balance Between Greece and Draghi

January 2015 kicks off, and the IBEX 35 trades within a range of 9,800 to 10,500 points, shadowed by two specters: the Greek election outcome and the European Central Bank's meeting. The circulating roadmap projected consolidation between 11,000 and 12,500 points, with profits coming "faster on the short side and slower on the long side." The problem, as almost always, was timing. And the timing was decided by someone else.

What Peine to the IBEX in January 2015?

The month began flat and deceptively. The index held near 10,000 points as oil plummeted, the dollar strengthened, and European public debt hit historic yield lows. Nobody knew if this was the prelude to a rally or a warning of a correction. A reference stop at 9,600 points served as both an entry point and a point of no return.

The major technical target repeatedly mentioned was closing the 10,800 gap, a resistance level untouched for months. Furthermore, the ECB meeting on the 22nd loomed: some argued that without genuine quantitative easing and with Greece unresolved, any rally would be an illusion.

Switzerland and the Franc: The Black Swan Nobody Saw Coming

Mid-month, the first earthquake struck. The Swiss central bank cut rates to -0.75% and removed the floor supporting the franc against the euro. The move caught half the market off guard, causing a 350-point surge in a flash that left many staring at their screens in disbelief. In currency markets, as in everything, those who thought they were covered discovered they weren't.

Draghi's Move Shakes the IBEX

On January 22nd, Mario Draghi appeared and unveiled the debt purchase program. The reaction was immediate: the DAX and Euro Stoxx 50 surged, while the IBEX lagged behind. Some closed short positions at 10,420 and peine long positions at 10,515 the same day. The official narrative spoke of euphoria; however, fourth-quarter accounting data remained weak.

Greece, Syriza, and Berlin's Scrutiny

Greece was the other focal point. A poll showed Syriza with an absolute majority and +10% voting intention, while Germany reportedly signaled in the press that it viewed a Greek exit from the euro favorably. Peripheral markets suffered: the IBEX weakened every time Athens hardened its stance. Closing the bullish gap before Greece dragged the index down became the obsession for long investors.

Santander, Telefónica, and the Paper Business

Meanwhile, corporate news provided fodder for another debate. Santander paid dividends in cash and shares, and some pointed out that a new share for every two old ones did not equate to a 5.8 euro dividend. Telefónica, meanwhile, neither confirmed nor denied Qatar's entry into its capital, with a potential 'mega-rights issue' on the horizon that would dilute small shareholders. The full details of remuneration calculations—rights, cash, and capital increases—are enough for an entire class in trench finance.

Penny Stocks, 'Anarosas,' and the Art of Losing a Euro Per Share

And then there are the penny stocks, bought at $6 and tracked by some until they collapsed. Some got out whole, some made a profit around 3 euros, and some were left watching their money evaporate. The lesson repeated by veterans: in a world of collapse, the real economy is worth zero, and activities close to financialization inflate.

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As the month closes, the question remains unanswered. The IBEX held its ground, the 10,800 gap remains unfilled, and Greece continued its path toward what each observer interpreted as ruin or salvation. The analysis stalls right there: nobody knows if the next move will be to close the gap upwards or to reverse and fill the one at 8,650.