IBEX 35 price aims higher as Spain prepares to loosen its lockdown

on May 9, 2020
Updated: May 19, 2020
  • Spain places the majority of its regions into the upgraded “Phase 1” step as the lockdown easing begins
  • New 179 deaths reported today, around 20% lower than 229 reported yesterday
  • IBEX 35 eyes a move above the 7,000 handle as the business activity expected to pick up in the coming days

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Spain is preparing to start “Phase 1” of the reopening plan this week as the death toll falls. IBEX 35, the benchmark stock index of the Bolsa de Madrid, finished the week around 2% lower although the bounce is likely to happen given the expected increase in the business activity. 

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Fundamental analysis: Phase I to commence this week

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Spain is preparing to significantly ease the lockdown measures this week as the death toll continues to decrease. It reported 179 new deaths today, lower than 229 reported yesterday and five times less than figures reported in April. 

“We’ve managed to retake 99% of the ground lost to the virus,” said Prime Minister Pedro Sanchez.

The “Phase 1” includes the opening of theatres, bars, restaurants, gyms, museums, hotels and gatherings up to 10 people. The country’s two largest cities – the capital Madrid and Barcelona – will continue to operate under the “Phase 0” regime, with hopes they would join the rest of the country in “Phase 1” next week. 

“We meet the health requirements; we can’t keep waiting. We have to get used to living with COVID-19,” said Ignacio Aguado, vice president of the region of Madrid.

Spain earlier announced that the gradual reopening of the country will be implemented through a four-step easing plan. The country has reported 26,478 deaths so far with more than 223,000 people infected.

Small businesses will also be allowed to open, such as hairdressers. Inditex, the owner of a popular fashion brand Zara, already opened some of its smaller shops across the country.

Technical analysis: IBEX 35 eyes 7,600

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IBEX 35 joined its Italian counterpart – the FTSE MIB – in crashing lower in March. The index lost more than 22% in a single month, to hit the lowest levels recorded since 2003. 

IBEX 35 daily chart (TradingView)

The buyers managed to secure a 15% bounce off the lows, however, the price action is struggling to sustain these gains. Investors will be hoping that the gradual reopening of the country will facilitate higher business activity in the coming weeks. 

Therefore, the bulls are likely to target a test of the key horizontal resistance near the 7,600 handle in the coming weeks.


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Spain has initiated a gradual reopening of the majority of its regions, with the exception of Madrid and Barcelona, as a part of the four-step easing plan. IBEX 35 is likely to be provided with a boost in the coming days with the opening of theatres, bars, restaurants, gyms, museums, hotels and shops.

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