·        IBEX 35 sentiment declines further, dropping into bearish territory

·        Significant drop could trigger further selling on the Spanish index

·        60 million securitised derivatives were traded on Spectrum last month

Spectrum Markets, the pan-European trading venue for securitised derivatives, has published its SERIX^TM European retail investor sentiment data for August (see below for more information on methodology), and notes the continuation of significant bearish trading related to Spain’s IBEX 35 index.

After dropping from a nine-month high in June to 105 in July, retail investor sentiment on the IBEX 35 fell further in August to reach a bearish SERIX^TM value of 95. This came as international investors contemplated the twin pressures of rising COVID-19 infections and the rapidly deteriorating situation in Afghanistan.

“Though the rate of new Spanish COVID-19 cases looked to be slowing into August, the IBEX 35 has struggled to maintain the upward trend it started in mid-July, and the SERIX data suggests retail investors are starting to get a bit nervous,” notes Thibault Gobert, Head of Liquidity Pool at Spectrum Markets.

“If the IBEX 35 experiences another significant decline, like the one seen in the second half of June, this could trigger further selling and, looking at the clear bearish signals we are seeing in our data, retail investors seem to be preparing for this scenario either by taking profits or positioning themselves for a drop in the near term.”

During August, 60 million securitised derivatives were traded on Spectrum, with 33.1% of  trades taking place outside of traditional hours (i.e. between 17:30 and 9:00 CET). 80.4% of the traded derivatives was on indices, 10% on currency pairs, and 9.6% on commodities, with the top three traded underlying markets being DAX 30 (27%), NASDAQ 100 (16.7%) and OMX 30 (13%).

Looking at the SERIX^TM data for the top three underlying markets, the DAX 30 moved back into bearish territory, dropping from 101 to 99 while the NASDAQ 100 also dropped two points, to 96. Meanwhile the OMX 30 recovered some of the bullish momentum seen earlier this year, rising from 92 to 99 in August.

Calculating SERIX^TM data