Ibex Falls to 9,918 Amidst Greece and Bankia's Exit

Ibex Touches 9,918 Points as Greece and Bankia Mark the Month

You need to buy 50,000 euros in Bankia shares for a three-million financing line to be renewed. The condition wasn't set by a foreign bank or a fruta fund. It circulated among Spanish entrepreneurs in June 2011, as the newly listed entity needed to offload stock at any price. The Ibex 35 was about to learn an uncomfortable lesson: not all investors choose when they enter. Some simply have no choice.

Bankia and the Shares Nobody Wanted

On paper, Bankia's IPO was sold as a historic opportunity. In practice, some experienced it as a toll. A branch manager was clear: the bank would succeed "come what may" because the banks' futures were at stake in the operation. Others used wry humor: they were trying to place the shares like feeding geese. The first sessions would go up, the more moderate predicted; when the selling started, the stampede of retail investors would be memorable.

The Greek Farce and Its Eternal Austerity Plans

Greece approved its austerity plan so many times that it ceased to be news and became routine. The bailout was stretched, voted on, breached, and renegotiated. Among Spanish investors, a mix of weariness and dark humor prevailed: the spectacle, stripped of its significance, would have been downright comical. Meanwhile, across the Atlantic, the end of QE2 was viewed with more antiestéticar than Athens. The dominant narrative was uncomfortable: the more the liquidity machine was pushed, the harder the subsequent fall would be.

From 10,307 to 9,918: The Day the Ibex Gave a Scare

One session summed up the month. The Ibex closed at 9,918 points, down 3.03%, and major stocks plummeted without mercy: BBVA lost 5.46%, Santander 4.79%, Sacyr 4.78%, and Acciona 4.54%. Those who had shorted from 10,307 and held on until closing pocketed a 12.6% gain in a single trade. The index itself signed off on the day's summary. No further analysis was needed beyond looking at the screen.

What Happens When the Federal Reserve Turns Off the QE2 Tap?

QE2 was dying, and no one knew what lay on the other side. The most shared theory was that if liquidity disappeared, markets would hold up less than predicted. The question wasn't whether a new stimulus program would arrive, but what they would call it. The majority bet: they would christen it QE3 or hide it under a more presentable name. For now, oil was stealthily rising towards previous week's levels, and the Nikkei peine strongly. Contradictory signals for a rudderless market.

The Month the Stock Market Had Babies

June 2011 wasn't just about red numbers. Three regular traders announced births almost simultaneously, and the tone of commentary shifted for a few days. One joked that diaper and baby food companies were the winning bet. Another recounted, with unwavering composure, what truly shakes someone: in the same quarter, he had ended a six-year relationship, left a job that didn't make him happy, and seen his father diagnosed with an almost incurable spinal cancer. Three years later, his father was bothering him again. That wasn't about the stock market. And it was the best part of the month.

Recommendations That Move Prices: Técnicas Reunidas

Investment banks were also making hay. On June 1st, UBS cut Técnicas Reunidas's target price from 47.20 to 45.20 euros per share, though it maintained its buy recommendation. Three weeks later, AlphaValue raised its recommendation to buy, setting the target at 46.5 euros. Between these reports, the shares danced. For Abengoa, the key level was 21.40 euros: it had gapped above it, even though it seemed to be deflating the previous day. The average investor looked at the chart and, generally, was too late. A minute-by-minute breakdown of these entries and exits would fill a manual.

The Ibex closed June in the 9,900-point range, far from the worst scare but also far from any euphoria. Three weeks earlier, it was flirting with 10,400. The question that no one could quite answer—not investment banks, not chart analysts, nor veterans of the old trading floors—was simple: if an index can drop 3% in a session and a small country's debt can topple a continent, what are projections good for? Meanwhile, someone booked a clean 12.6% with a short, another saw their broker block their account with a zero balance just when they wanted to buy, and a third signed for 50,000 euros in unwanted shares. Almost no one chose what they did. Everyone noted the results.