Bankinter expects stock markets to regain ground this week, supported by the ECB meeting and corporate earnings that exceed expectations. The moderation of inflation and oil prices below $100 reinforce optimism.
Bankinter believes that the tone of the stock markets should improve this week, following a previous week of declines that the entity interprets as a healthy profit-taking. Support will come from the European Central Bank meeting, the publication of new corporate earnings, and a macroeconomic agenda that continues to show resilience.
US inflation moderated in June to 3.5%, down from 4.2%, while in Europe it fell to 2.8% from 3.2%. This evolution reduces pressure on central banks and decreases the likelihood of further rate hikes, according to the entity's analysis.
Corporate earnings also provide support. The financial sector stood out with strength in market activities and investment banking, and credit investment increased by an average of 9%. Companies like ASML, Richemont, and BlackRock have already published favourable figures.
The ECB could adopt a less aggressive tone
The ECB meeting on Thursday will be one of the key references. Bankinter expects the body to keep rates unchanged, with the deposit facility at 2.25%, the credit rate at 2.40%, and the marginal facility at 2.65%. The moderation of inflation and still positive economic growth provide room for patience.
The entity interprets the 25 basis point hike approved in June as a preventive decision, rather than the start of a new tightening cycle. For investors, this means that the ECB is not tightening more than necessary, which gives breathing room to equities.
The US macroeconomy continued strong, with good records in retail sales, manufacturing activity, and consumer confidence. The negative note came from the rising tension between the United States and Iran, which pushed Brent up to $90, although still far from the $100 per barrel threshold.
The earnings season enters a decisive phase
This week, companies such as General Motors, Halliburton, Alphabet, Tesla, Intel, and American Express will publish their accounts in the US, while in Europe it will be the turn of Iberdrola, Santander, UniCredit, and Repsol. Bankinter expects the balance to remain solid.
Consensus anticipates earnings per share growth of 24% in the US and 15% in Europe during the second quarter, and the known figures exceed forecasts. For investors, this reinforces confidence that current valuations are backed by fundamentals.
The agenda is completed with the German ZEW survey and the preliminary PMIs from Europe and the US, which should remain in expansion territory. Additionally, the launch of the new Kimi K3 model by the Chinese company Moonshot raises fears that China may close its technological gap with the US, a geopolitical factor to watch.
Overall, Bankinter considers it reasonable for stock markets to recover some of last week's losses. The entity expects a week of improvement, provided that the geopolitical situation does not provoke a new spike in oil prices above $100. For investors, the strategy is to maintain positions and take advantage of dips as buying opportunities, with an eye on earnings and ECB decisions.
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