Ibex 35 Tests New Records as Oil Slips and Unicaja Jumps on Results

The Ibex’s Record-Testing Session: Geopolitics Meets Earnings

The Ibex 35 was poised to close July at an all-time high, buoyed by a sudden easing of geopolitical tensions that sent oil prices tumbling and gave investors fresh confidence to bid up Spanish equities. With futures pointing above 19,900 points, the benchmark index looked ready to cap a turbulent month on a strong note.

The catalyst was an agreement brokered by former US President Donald Trump to de-escalate the conflict in the Middle East – specifically the disarmament of Hamas – which not only calmed fears of wider regional instability but also reopened the door to US-Iran diplomacy. Brent crude, which had breached $100 a barrel barely a week earlier, slid below the $90 mark, falling a further 2% on the day.

That retreat in energy costs instantly cooled inflation angst at a delicate moment when central banks are weighing further rate hikes. For investors in Madrid, it was the perfect backdrop as the final wave of second-quarter earnings rolled in. Unicaja stole the show, its shares rallying 3.2% after the bank reported results that comfortably beat expectations. The gains were enough to offset sharp declines elsewhere: IAG dropped nearly 5% after revealing a 21% slump in profit, while Acciona and its renewables offshoot Acciona Energía both sank, with the parent initially shedding more than 6% before settling around 4% lower.

Asian markets provided a mirror image. South Korea’s Kospi surged 18%, driven by AI-linked stocks, though it still ended July roughly 20% down. In Tokyo, the Nikkei gained 4% after the Bank of Japan signalled it was in no hurry to raise rates, removing another global headwind. With the Spanish market already up in futures and the August vacation period about to begin, traders saw enough reasons to push the Ibex to new heights.

Behind the Rally: Unicaja’s Outperformance and Oil’s Sudden Retreat

Why Unicaja Rallied as the Rest Stumbled

Unicaja’s earnings landed at exactly the right moment. In a session where lenders’ sensitivity to rate expectations was front and centre, the Spanish bank not only delivered solid numbers but also signalled that cost discipline and net interest income were holding up better than feared. That earned it a 3.2% share price jump and the top spot on the Ibex leaderboard. For investors who had been rotating into financials on hopes of a soft landing, the results offered tangible proof that Spain’s regional banks can thrive even as the ECB ponders its next move.

By contrast, IAG’s profit warning landed with a thud. The 21% profit drop was far steeper than analysts had pencilled in, reviving concerns about cost pressures in the airline sector – particularly fuel hedging, labour deals and capacity discipline. The shares fell 5%, a clear signal that the market believes the earnings downgrade cycle for legacy carriers may not be over.

Acciona and Acciona Energía provided the other big drag. The initial 6% intraday plunge in the parent suggests investors were deeply disappointed by the numbers, perhaps because renewable energy margins are contracting faster than expected in an era of falling power prices and rising financing costs. The fact that both the parent and its listed renewables arm sold off simultaneously underlines that the disappointment was company-specific, not a sector rotation.

Oil’s Retreat: A Window for Central Banks

The drop in Brent from over $100 to under $90 matters far beyond the energy sector. It directly lowers headline inflation across the eurozone and dampens the impulse for the ECB to deliver another rate increase in September. For the Ibex, which is heavy with banks that benefit from higher rates but also with industrials and utilities that hate expensive energy, the oil slide creates a sweet spot: a less hawkish central bank without the demand destruction that usually accompanies runaway energy costs.

Of course, the geopolitical lever is fragile. The US-Iran diplomatic channel and the Hamas disarmament agreement are both at an embryonic stage; any breakdown could send crude back above $100 in days. Still, for now, the combination of a lower oil price and the BoJ’s decision to hold rates is giving global equities – and the Ibex in particular – a clear run at new records.

Asian Markets’ Split Personality

The 18% single-day surge in South Korea’s Kospi, even as it remained down 20% for the month, illustrates the extreme volatility that AI hype has introduced. The move appears concentrated in a handful of semiconductor and tech stocks, but its sheer size can unsettle European investors who worry about parallels with the dot-com era. The Nikkei’s 4% jump on a dovish BoJ is more straightforward: Japan’s central bank removing itself from the list of tightening risks removes a major overhang for yen-carry trades and global risk appetite. For the Ibex, which has no direct AI exposure but benefits when global risk appetite strengthens, both moves were interpreted as a tailwind.

What July’s Final Trading Day Means for Investors

The trading dynamics of the last day of July leave several concrete signals for investors watching the Spanish market:

• Unicaja’s results validate the regional banking thesis: The cost control and net interest income beat suggest the mid-cap Spanish lenders are not yet squeezed by ECB policy. Investors holding the stock or considering entry may find support at current levels, but should watch for news on the Spanish bank levy that could cap re-ratings.
• IAG’s profit miss is a red flag for airline bulls: The 21% profit drop implies that fuel hedging gains are fading and that labour costs are biting. Those with exposure to the travel sector should test their assumptions about the pace of margin recovery; the 5% sell-off may be the start, not the end, of a repricing.
• Acciona’s slide signals mounting pressure on renewables margins: With power prices normalising and debt costs rising, the infrastructure and energy group faces a tougher second half. Investors in the broader renewable space should scrutinise upcoming quarterly reports for similar margin compression.
• The oil price retreat could extend the equity rally if it holds: Every $5 drop in Brent shaves roughly 0.2 percentage points off eurozone headline inflation. If the geopolitical détente proves durable, the Ibex could challenge 20,000 points sooner than consensus expects – but a sudden reversal in the Middle East would wipe out that argument quickly.