IBEX 35 Analysis in the Spanish Stock Market Pre-market: 2025 Outlook

Current Performance of the IBEX 35: A Year of Record Highs

In the last months of 2025, the Spanish benchmark has experienced a remarkable growth rate, positioning it among the best results of the main European markets. With an accumulated gain close to 37% since the start of the year, the IBEX 35 has solidified an upward trend that contrasts with the more moderate performance of indices like the DAX or the CAC 40.

The most significant move has been surpassing the 17,000-point barrier, a historic milestone never before reached in its history. Closing levels hover around 16,850 points, reflecting a consolidation with optimism about the Spanish economy. This advance has been supported by sustained momentum in defensive and cyclical sectors, particularly in large-cap stocks that have attracted foreign capital flows.

Factors Driving the Spanish Market

The Financial Sector as a Key Player

The performance of Banco Santander, BBVA, and CaixaBank continues to be one of the main pillars of the index. The corporate results of these institutions have exceeded estimates, reinforcing confidence in the Spanish banking business model. Simultaneously, share buyback initiatives and attractive dividend policies have captured the interest of international investors seeking income.

Energy and Utilities in Expansion

Companies like Iberdrola, Endesa, and Naturgy have benefited from a favorable regulatory environment and increased energy demand. News about Ferrovial’s entry into the Nasdaq-100 served as an additional catalyst, demonstrating the international recognition of Spanish corporate quality.

The Effect of Large Cap Stocks

Inditex has maintained its relative importance, generating significant movements in the pre-market and during regular sessions. Its contribution remains decisive given its 15.48% weight in the index composition.

Favorable Macroeconomic Context

European data have shown moderation in inflation, with readings close to 1.9% in Spain. The European Central Bank maintains a cautious tone that allows for greater risk-taking space. Internal political stability and employment strength, which has reached a historic maximum of 20.9 million affiliates, act as buffers for the Spanish economy.

Technical Outlook for the Upcoming Sessions

In the context of the Spanish pre-market for December-January, a more contained movement of the index is expected. Without significant macroeconomic surprises, the benchmark would tend to oscillate within defined margins.

Technical levels to consider:

• Main resistance: 17,000 – 17,200 points
• First support: 16,600 – 16,700 points
• Bullish extension target: 17,300 points

Technical indicators show an RSI in consolidation zone (45-55 points) and narrow Bollinger bands, suggesting a technical pause after the previous advance. This phase is typical before new directional movements.

Historical Analysis of the IBEX 35: Path to All-Time Highs

Fall 2025 Momentum

Breaking above 16,000 points in October marked the start of an accelerated phase. From that moment, the index surged toward 16,600, driven by the strength of the banking sector and improved sentiment toward the Spanish economy.

Seasonal Volatility and Profit-Taking

November showed small setbacks, typical after extensive gains, with investors taking partial profits. However, the overall trend remained firm.

September-October Period

During this stretch, the IBEX 35 gradually recovered. After a less dynamic September, October brought a steady acceleration. The index moved between 15,400 and 15,700 points, supported by confidence in the financial sector and investment announcements from major electric companies.

Notably, the rejection of the public takeover bid for BBVA over Sabadell cleared regulatory uncertainties. Simultaneously, Santander increased its interim dividend by 15%, boosting the index’s income appeal. Iberdrola announced an investment plan exceeding €100 billion until 2031, focusing on grid infrastructure in the UK and the US.

Summer of Strength: August-September

During these months, the IBEX 35 confirmed its upward trend above 15,000 points, touching around 15,400. The performance was supported by excellent management from Inditex, which posted solid results and attracted global investor attention.

September 10 marked a daily gain peak of +1.25%, mainly driven by Inditex’s performance, while the European tech sector showed relative weakness. The strength of domestic Spanish consumption and access to European recovery funds also fueled buying flows.

In terms of inflation, August confirmed a year-on-year reading of 2.7%, with core inflation at 2.4%, reinforcing perceptions of stability. Expectations of a Federal Reserve rate cut in September accelerated risk appetite.

July: Sustained Takeoff

The IBEX 35 started July firmly at 14,800 points and steadily climbed toward 15,200 in August. This movement was supported by optimism over interest rate cuts in the US and the strength of the national financial sector.

Technical indicators already reflected high strength by late July, suggesting imminent consolidation. The momentum responded to concrete factors: easing trade tensions, exceptional corporate results, and Spanish banks in top form, with BBVA and Iberdrola leading gains.

June: Consolidation Under Pressure

The month began positively after the ECB announced a rate cut to 2% on June 5. However, on June 11, Inditex released weak sales figures, causing a 4.6% drop in its shares and dragging nearly forty points from the index.

On June 13, Israeli attacks on Iranian facilities pushed crude oil prices higher, triggering a global defensive shift. The IBEX hit lows of 13,780 points. Despite these movements, Spanish and Eurozone harmonized inflation fell to 1.9%, reinforcing expectations of further rate cuts.

Composition and Fundamental Structure of the IBEX 35

What the IBEX 35 Represents

The IBEX 35 is the benchmark stock index in Spain, comprising the 35 most liquid companies listed on the Madrid Stock Exchange. Its sector coverage includes banking, energy, telecommunications, construction, and consumer goods, making it a key indicator of the Spanish economy.

As a market-cap weighted index, larger companies have a greater impact on its movement. It is calculated in real-time during trading hours from 9:00 to 17:30 local time, providing a continuous view of the Spanish market’s performance.

Main Components and Their Relative Weight

The leading companies in the index are:

Sectors Comprising the Index

Calculation Methodology and Review

The IBEX 35 is adjusted for free float, considering only publicly tradable shares in the market capitalization calculation. Its composition is reviewed semiannually to ensure it continues to represent the 35 most liquid companies. The IBEX Technical Advisory Committee conducts these reviews, adding or removing companies based on liquidity and market cap.

Historical Performance and Volatility

Past Annual Returns

Volatility Characteristics

The IBEX 35 is known for exhibiting high volatility compared to other major European indices. This trait is attributed to its concentrated exposure in cyclical sectors like banking and energy. The wide annual ranges reflect both significant highs and concerning lows over short periods.

During economic crises, the index tends to suffer sharper declines than its peers but also experiences quick recoveries during boom periods. This dynamic creates both risks and opportunities for well-positioned investors.

Long-Term Outlook: 2025-2030

Projected Economic Growth

The Bank of Spain has improved its forecasts, estimating a GDP growth of 1.9% for 2025. This dynamism will be mainly driven by tourism, the external sector, and employment improvements. Private consumption and corporate investment will continue to be key elements to sustain momentum.

Monetary Policy as a Decisive Factor

The Federal Reserve has begun rate-cut cycles, with expectations of cumulative reductions of 100 basis points by the end of 2025. This measure will benefit the global economy by lowering corporate financing costs. The European Central Bank might adopt a more moderate stance, limiting stimulus in certain European segments.

Banking Sector Challenges

The Spanish financial sector has generated record profits thanks to the high interest rate environment. However, expected rate cuts will significantly compress interest margins. Entities like CaixaBank, Banco Sabadell, and Bankinter will face profitability pressures, reducing their relative weight in the index.

Opportunities in Renewable Energies

The energy sector, especially focused on renewables, is poised as a long-term protagonist. Growth in data infrastructure and the expansion of artificial intelligence will increase electricity demand. By 2030, energy consumption linked to data infrastructure could account for up to 3.2% of European electricity supply.

Companies like Solaria, Acciona Energía, and Endesa will benefit from this growing demand, especially during the energy transition. Although they experienced corrections in 2024, their involvement in clean energies offers significant potential.

Global Risks and Expected Volatility

The probability of recession in the US and worldwide is estimated at 45% for 2025, due to labor weakening and demand slowdown. This uncertainty could trigger episodes of volatility in global markets. The IBEX 35, being sensitive to external shocks, would not be exempt.

Gold’s behavior acts as an alert indicator. With gains exceeding 20% in 2024 and projections toward $2,700 per ounce in 2025, the sustained increase reflects recession fears or geopolitical tensions, historically signals of stock market instability.

Stimuli and Recovery

European Union investment plans, such as the Draghi report focused on digitalization and decarbonization, provide a boost for key sectors. With significant public investment and private sector support, these stimuli can contribute to the resilience of the Spanish market, offering long-term opportunities despite possible volatility.

Conclusion

The IBEX 35 is in a phase of relative strength, with all-time highs in sight and Spanish economic fundamentals improving. The Spanish pre-market opening in the coming months will likely remain cautiously positive, with technical oscillations around established levels. Investors should stay attentive to European economic data, ECB monetary decisions, and the performance of index giants to navigate the characteristic volatility of this market.