Madrid stocks sink on Catalan woes; London retreats from record
New York, (MILLAT ONLINE):The Spanish stock market tumbled Friday after a victory for Catalan separatists in a snap poll, while London hit an intraday record before retreating.
On the other side of the Atlantic, Wall Street stocks retreated as President Donald Trump signed a long-awaited tax cut into law ahead of the Christmas holiday.
US stocks had risen to repeat records earlier in the month in anticipation of the measure, but began to sag this week as the proposal cleared the final hurdles in Washington.
“It’s a case of ‘buy the rumor, sell the news,'” said Quincy Krosby, chief market strategist at Prudential Annuities.
Madrid’s benchmark IBEX 35 index of top companies ended the session around 1.2 percent lower after the Catalan vote injected new uncertainty into one of Europe’s biggest economies.
With turnout at a record high of 82 percent, Thursday’s election handed a mandate back to the region’s ousted separatist leaders after they campaigned from exile and behind bars.
“Investors in Spain lost their Christmas cheer,” said IG analyst Jasper Lawler.
“It’s a frustrating result for shareholders invested in Spain to capture the country’s rising economic fortunes. Political disruption looks like it will be an ongoing feature of investing in Spain.”
Frankfurt stocks declined 0.3 percent and Paris dipped 0.4 percent.
The euro also pulled back against the dollar, but the decline was modest.
The Catalan result is “likely to keep tensions between Madrid and Barcelona elevated but at least for now, not likely seen as leading to an imminent breakup of the euro zone’s fourth largest economy,” said Omer Esiner, analyst at Commonwealth Foreign Exchange.
Bitcoin plunged about 25 percent at one point to near $12,000 as investors exited the controversial cryptocurrency. But ever volatile, the currency began to push higher later in the day and stood at $14,445 near 2140 GMT.