Spanish Stock Market Spread Betting Guide

Madrid Stock Exchange
The Madrid Stock Exchange… during a siesta


Spain 35 Spread Betting Guide

While you can spread bet on individual Spanish shares the more popular trade is the Spain 35, i.e. the main Spanish stock market index, i.e. an index of 35 leading Spanish stocks.

With spread betting and CFD trading, the Spain 35 is often called the IBEX 35.

arrow_forwardLive Spain 35 Chart
arrow_forwardLive Spain 35 Prices
arrow_forwardWhere to Spread Bet on the Spain 35
arrow_forwardHow to Spread Bet on the Spain 35
arrow_forwardWhere to Spread Bet on Spanish Shares
arrow_forwardSpanish Stock Market Opening and Closing Times


Live Spain 35 Chart and Prices



Spanish Stock Market Opening and Closing Times

The spread betting market follows the Spanish stock market opening and closing times.

The opening hours are just:
  • arrow_forward8am to 4.30pm (UK time)
  • arrow_forward9am to 5.30pm local time in Madrid
This means that the Spain 35 spread betting market isn’t like the FTSE 100, DAX or Dow Jones, it doesn’t operate in a quasi-24 hour spread betting market.

warning Gap warning: The market hours mean that there is a lot of time for positions to be built up outside trading hours and therefore the Spanish stock market can be more prone to gaps than the 24 hour markets.


15 November 2017: Spanish Stock Market Sell Off Increases

We’re seeing plenty of weakness in global indices and the IBEX is no exception.

In fact, the market has fallen back into the down-channel we discussed below.

Here’s a quick 5 minute technical analysis video on where the Spain 35 could go next.


2 November 2017: New Technical Analysis of the Spanish Stock Market

Below, a 6 minute video on the current state of play of the Spain 35.


31 October 2017: Spanish Fly in the Ointment

OK, this is one of those (many) moments when I don’t get in the markets.

How did the Spain 35 rise so much with so many political issues, particularly with the Catalonia government officials running off into hiding?

But… this is also what happens in the markets…they rise when they should fall, they wilt when they should flourish.

As usual the markets seem designed to move in the direction that will hurt the most people.

And this is why we spread bet with:

  • arrow_forwardStop Loss orders
  • arrow_forwardSmall stakes e.g. in this case, it was just £0.5/pt.
An irritating loss? Yes. Will I lose sleep? No



30 October 2017: WTF! My Short of the Spain 35 Isn’t Going Well

The IBEX 35 gapped 163pts higher from Friday’s close to the open this morning at 10,361.

Given all the risks, this doesn’t make much sense to me.

Madrid has triggered article 155 to reply to the Catalonian declaration of independence. I’m not sure what’s holding the index up.

Dissolving the Catalonian institutions and calling quick elections could help settle the situation… if a new administration is less inclined to independence.

The big and peaceful demos over the weekend do help to calm things down.

If the new administration is still pro-independence though, then that causes a big headache for Prime Minister Rajoy. Of course, according to Michael Hewson of CMC Markets:

It’s a risky strategy given the unsavoury events from the beginning of October

The bigger and more immediate question is whether, after declaring independence, the Catalan government still recognises the directives being issued from Madrid
Put another way, I expect the Catalan politicians’ thought process to be:
  • warning“If we think we’ll win the new elections then we’ll listen to Madrid, pretend to be the good guys, and get a new mandate”
  • warning“If we don’t think we’ll win the new elections then we won’t listen to Madrid, we’ve already declared independence”


Spain Q3 GDP

This morning’s flash GDP number for Q3 was only estimated to have a modest drop from 0.9% to 0.8% and the 0.8% figure duly came in.

Note that the Catalan economy accounts for roughly 20% of Spanish GDP. If there is an escalation then that could well drag on the wider economy.


My Spain 35 Trade

The market is still in the channel as per the chart below and it’s not hit my stop.

It’s only £0.5/point short so I’m going to let it ride for a bit. It won’t take a big war of words from either side to cause a little stock market panic.



27 October 2017: Small Short after Catalan Parliament Votes to Declare Independence

The vote was just a few hours before the Spanish government were set to impose direct rule on the region.

The IBEX has quickly lost 1.2% and I’ve missed out on that.

But I’ve taken a small speculative short over the weekend… and the Spain 35 does like to gap. Of course that gap could go either way.

Before trading I’ve checked the 5 minute chart:

Spain 35: 5 Minute Chart
Spain 35: 5 Minute Chart

… and the one day chart.

The one day chart is showing the Spanish stock market is still in the same wide down trend that it’s been in a since the May high.

Also, the market was near the top of the channel which has nicely acted as resistance. This gives me a little more comfort with a short position.

Spain 35: 1 Day Chart
Spain 35: 1 Day Chart


Spread Bet Set-up
This is just supposed to be a short term spread bet.

  • trending_down£0.5/pt short @ 10,195
  • thumb_upLimit order (take profit order): just above the support at 10,000 so 10,010
  • warningStop Loss order: a little above the channel and recent support at 10,425 so 10,458
  • arrow_forwardNext A: check the news over the weekend to see if there is a big political escalation
  • arrow_forwardNext B: probably close when the market opens at 8am unless there’s a strong down trend in which case I’ll keep the trade open for up to 30 minutes… unless all political hell breaks loose…


11 October 2017: Spanish Stock Market Seeing More Nasty Gaps!

Catalan President Carles Puigdemont may have bottled it or perhaps he was a grown up who’s playing:

a) the long game, and
b) the democratic-ish game.

Yesterday he suspended the declaration of independence in the hope of talks. The Spanish government remains the bad actor and seem pretty quiet…

Either way, Spanish equities have continued their bumpy ride higher and gapped 168 points higher overnight.

That gap could be painful for some.

warningIf you are trading, don’t forget all the previous gaps (examples below)… or the 134 point gap higher over the weekend or the 32 point gap lower from Monday’s close to yesterday’s open.

A lot of caution is needed.



10 October 2017: Sometimes It’s Better Not to Spread Bet!

As discussed below, I thought about a speculative short from the Friday close to the Monday open.

Just a £0.50 short placed late on Friday afternoon. Although I did say it was speculative and say that the “big risk is the obvious gap higher”.

Luckily, I was too busy on Friday afternoon and never got round to placing the spread bet.

The market gapped higher from the Friday close at 10,177 to the Monday open at 10,311, a rather unpleasant 134 gap higher.

Glad I missed that “spread betting opportunity”.


6 October 2017: Mierda! That Wasn’t Supposed to Happen

It wasn’t unexpected that the Spanish government would resort to various legal means to try to stop Catalonia declaring independence.

The Spanish government always referred to the constitution and that it would be illegal to declare independence.

So when the Spanish constitutional court suspended the Catalan parliament that was not unexpected.

To me market reaction was unexpected though.

I saw the news flash about the constitutional court but to me it didn’t make a big difference. After all, declaring independence was always illegal.

Once the news came out the market spiked from 10,150 to 10,260. In early trade today it’s already back to 10,160.

Resulting Loss: Stop order hit at 10,200 = 164pt (£82) loss. Mierda.


Very Short-Termist Markets

We must always remember how short-termist the markets are.

Again, to me, suspending the Catalan parliament it didn’t make a big difference. If anything it would only aggravate the situation.

However, the financial markets rarely take that longer(?)-term view.

Of course, as we discussed below, we know the markets can be very short-termist.

On the fateful night when The Donald was voted in, the S&P 500 quickly lost 5% only to recover it all in the same evening/morning.

The news about the constitutional court was a knee-jerk reaction. Perhaps I just should have had a wider stop… or a closer stop… hindsight is awesome.

At least I only used £0.50 stakes.


Gapping Warning

warningRemember that the IBEX financial spread betting market hours are the same as the main ‘Bolsa de Madrid’ hours, i.e. just 8am to 4.30pm (UK time).

This leaves plenty of room for gapping.

We’ve seen gaps for the last couple of nights and last night the market gapped 43 points down from 10,222 to 10,179 on the open.

That’s not a nightmare but there wasn’t much news either. We could see much bigger gaps. Caution is needed (as well as small stakes).


Where Next?

We’ve just seen 282 point and 347 point daily moves I don’t want to trade the various intra-day rumours with such nasty moves.

However… I can see there being a lot of speculative news over the weekend that could make the markets nervous.

A speculative short over the weekend could work.

I might place another £0.50 short later this afternoon and then try to get out quickly when the market opens on Monday – the big risk is the obvious gap higher.

But I can’t see everyone making-up and being ‘bezzy mates’ over the weekend.

Spain 35 Chart  - June to 6 October 2017
WTF!



4 October 2017: King Pours Fuel on Catalan Fire

It doesn’t matter if the Catalan’s have gone the wrong way about the Catalan independence referendum… from a political point of view the Spanish government is blundering left, right and centre, e.g.:
  • arrow_forwardThe police were excessive at the weekend
  • arrow_forwardSpain’s largely ceremonial king, Felipe VI, came out fighting (and ignored the police violence). Rather than bring people together he’s divided them. Perhaps he’s taking lessons from Trump.
The result is a poorly run referendum that many Catalans didn’t want… but the government’s actions seem to have united Catalonia’s anti-Spanish-government sentiment.

This doesn’t bode well for the Spanish stock market.

Looking at the main Spanish stock market index, i.e. the Spain 35:

  • trending_downThe one day chart shows the market has been trending down since the 11,177 high on 8 May.

Spain 35 Chart Trending Down
Trending down in a channel that’s too wide to be helpful…


  • trending_downOn Friday, the Spain 35 closed at 10,354 but gapped down over the weekend to 10,223 which is a nasty 131 gap but not a nightmare if you use small stakes…

    And, whether it was an official or not, I have no idea why you’d use large spread bets ahead of a referendum.

  • trending_downToday the IBEX 35 (another name for the Spain 35) took another fall after King added his two céntimos worth last night.

Spain 35 Sell Off
The King’s Speech Wasn’t Received Well

(A ‘céntimo’ is the old Spanish equivalent of a penny but you know that).


Where Next for the Spanish Spread Betting Market?

  • errorI’ve already been a school boy and rushed in and shorted the Spain 35 @ 10,010 knowing it could be too late.

    And it was too late.

    The market hit resistance at 10,000 and bounced.

    I finally switched my brain on and closed that trade for a 24pt loss. I was just £0.50/pt short. Time to think.

  • infoNote that the Spain 35 often has wider spreads e.g. Financial Spreads offers a 4pt spread but I’ve seen worse spreads for the IBEX 35.

  • trending_downI’d go with a max 5% fall in the current move (see below)

5% Stock Market Fall?
A stock market index will rarely move more than that in the same short-term move. E.g. when news came out that Trump would be President the S&P 500 crashed 5% and then quickly bounced back in the same evening/morning.

Note that the S&P 500 was helped but going ‘limit down’ (that automatically suspended the market for a short period).

However, talking to people on various trading desks over the years, a 5% is a big move for a stock market.

Let’s say we start at Friday’s close of 10,354, a 5% drop would take us 517 points down to 9,836.

With the market at 10,050 that’s still a tempting profit… but we also need to get through that 10,000 barrier.

After that though, the next resistance is around 9,000 – 9,500.

So putting aside my school boy mistake, and giving myself time to think, I have had another £0.50/pt short.


Catalonia to Declare Independence?
Catalonia’s President Carles Puigdemont said his government would “act at the end of this week or the beginning of next” in order to declare independence.

Note that only a reported 40% of the electorate voted at the weekend (it was difficult to vote while being blocked and/or beaten by the police) but that 90% of those voting did vote for independence… really?

Seems like it needs a fair and proper vote and then a lot more discussion but that logical seem to have become lost along the way.

As Michael Hewson, Chief Market Analyst, CMC Markets said:

The King has lashed out at the Catalan government without even acknowledging the police violence at the weekend.

Having miscalculated so badly with their reaction over the weekend it would appear that Rajoy, the Spanish Prime Minister, is in no mood to compromise and looking to double down.

He may be well within his rights under the terms of the constitution but it’s difficult to see how this can end in any other way than badly.

Spread Bet Set-up:
  • arrow_forward£0.50/pt short of the Spain 35 at 10,036
  • arrow_forwardStop order: 10,200 (164pts or £82 loss)
  • arrow_forwardLimit order (take profit order): 9,836 (200pts or £100 profit, this round number is just a coincidence)
Trading Options:
  • arrow_forwardIf the Catalan or Spanish government rhetoric gets more extreme I may adjust my Limit order to 5,600. Likewise if the Catalan’s declare independence
  • arrow_forwardIf we see a quick move through 10,000 then I may add another £0.50/pt short with a Limit order at 9,836 or 5,600
  • arrow_forwardIf the market grinds to halt at 10,000 then my upside might be very limited and it could be an idea to get out of this trade


Where Can I Spread Bet on the Spain 35?

A number of the more established brokers offer live charts & prices on stock markets indices including Spain 35, e.g.:

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Where to Spread Bet on Spanish Companies

You can trade a selection of leading Spanish shares with:

AuthorAlex Turner

Senior Editor, SpreadBetMagazine

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