Ibex 35 Analysis: Short-Term Stock Market Forecast and Opportunities in 2025

The Ibex 35 at Its Best Moment: What to Expect Now?

The Ibex 35 has experienced one of its most memorable years. With an accumulated appreciation close to 37% since the start of 2025, the Spanish index ranks among the most profitable in Europe, far surpassing the performance of the German DAX and the French CAC 40. This dynamism is not driven by speculative moves but by solid fundamentals rooted in banking, renewable energy, and the strength of large multinationals like Inditex.

Understanding the Ibex 35: The Compass of the Spanish Stock Market

The Ibex 35 represents the 35 most liquid companies listed on the Madrid Stock Exchange. This capitalization-weighted index groups assets from various sectors: financial services (Banco Santander, BBVA, CaixaBank), energy (Iberdrola, Endesa, Repsol), technology (Telefónica, Cellnex), consumer goods (Inditex) and industry (Ferrovial, ACS).

The real-time calculation methodology, operating between 9:00 and 17:30 hours, automatically adjusts each company’s weight according to its free float, ensuring that only publicly tradable shares influence the final movement. Every six months, a technical committee reviews the composition to ensure the index continues to accurately represent Spain’s most dynamic business fabric.

The Heavyweights Moving the Market

The structure of the Ibex 35 is concentrated in a few hands. Inditex leads with 15.48% of the index, followed by Iberdrola (13.83%), Banco Santander (12.13%), and BBVA (9.36%). These four names account for nearly 51% of the total weight, meaning their movements define the overall direction of the index. CaixaBank, Amadeus, Ferrovial, Telefónica, Aena, and Cellnex complete the circle of key companies.

This concentration implies that analyzing the Ibex 35 requires special vigilance on these giants. When Inditex experiences corrections, as happened in June after weak sales (drop of 4.6%), the impact on the index is immediate and significant.

Sector Map: Where Gains and Losses Occur

The index is distributed across key sectors reflecting the contemporary Spanish economy:

• Financial Services: The historic engine of the Ibex 35, though its future depends on ECB interest rate decisions
• Oil and Energy: A transforming sector with emerging opportunities in renewables
• Technology and Telecommunications: Exposure to global growth in data and AI
• Consumer Goods and Services: Dependent on the strength of domestic consumption and tourism
• Materials and Industry: Sensitive to global economic cycles

Recent Path: How the Ibex 35 Reached Here

By mid-October 2025, the Ibex 35 broke the psychological barrier of 16,000 points, reaching lows of 16,600 thanks to momentum from the financial sector and improved investor sentiment. During the first half of November, it experienced small profit-taking after the rally, consolidating into a technical resting phase.

Between mid-November and mid-December, the index confirmed its annual rebound by touching and temporarily surpassing 17,000 points—a milestone never reached before. This achievement reflected a sustained bullish push driven by positive tone in banking, cyclical stocks, and large corporate investments. The close around 16,850 points indicates a firm market, optimistic about Spanish economic prospects.

Catalysts Explaining the 2025 Rally

Banking Sector: Exceptional results from BBVA, Santander, and CaixaBank exceeded estimates, reinforcing confidence. Simultaneously, buyback programs (BBVA announced 1,000 million euros) and dividend increases (Santander raised its payout by 15%) attracted international capital seeking yields.

Energy and Utilities: Iberdrola outlined an investment plan exceeding 100 billion euros until 2031, with a focus on networks in the UK and the US. Endesa and Naturgy benefited from a stable regulatory environment and increased electricity demand.

Macroeconomic Context: Harmonized inflation in Spain stabilized at 2.7% year-on-year, with core inflation at 2.4%, reinforcing perceptions of stability. The ECB maintained a cautious tone according to September minutes, favoring more accommodative financial conditions for peripheral economies. Expectations of a 25 basis point rate cut by the Fed in September fueled risk appetite.

Corporate Factors: Inditex surprised positively with solid results in August, boosting the index with gains of 1.25% on its best day. Ferrovial announced its entry into the Nasdaq-100, strengthening the international appeal of the Spanish market.

Labor Market Strength: Spain reached 20.9 million affiliates to the Social Security system—a record high—acting as a cushion against external volatility.

Short-Term Market Outlook: What Will Happen Between December and January?

Looking ahead from December 15 to January 15, the short-term market forecast points to a sideways movement without a clear direction, but characterized by stability. Without significant macroeconomic surprises, the Ibex 35 should fluctuate within well-defined technical levels.

Key Reference Levels:

• Main Resistance: 17,000–17,200 points
• First Support: 16,600–16,700 points
• Upside Extension Target: 17,300 points

Technical indicators (RSI in the 45–55 range, narrow Bollinger Bands) confirm consolidation, suggesting the market is accumulating energy before defining the next dominant direction.

Short-Term Risks to Monitor

Global Tariff Escalation: US tariff policies pose a key risk. In June, the extension of tariffs caused the Ibex 35 to retreat to 13,960 points.

German Industrial Weakness: Slowdown in Europe’s largest economy affects demand for Spanish goods and business confidence.

Geopolitical Tensions: Attacks in the Middle East in June raised oil prices and triggered a global defensive shift, with the Ibex hitting lows of 13,780 points.

Banking Margin Compression: With expected rate reductions in upcoming years, interest margins for entities like CaixaBank, Sabadell, and Bankinter could compress significantly.

Long-Term Outlook: 2025–2030

Base Economic Scenario

The Bank of Spain projects GDP growth of 1.9% for 2025, driven by tourism, export sector, and employment improvement. However, private consumption and business investment need to recover to sustain momentum. This improvement coincides with a context where the Federal Reserve has already begun reducing rates toward 100 basis points by late 2024, while the ECB may maintain a more moderate stance.

Banking Sector: Relative Decline

Spanish banks recorded record profits thanks to high rates, but expected reductions will compress margins. This challenge implies that the banking sector could lose relative prominence in the Ibex 35, altering the profitability composition of the index.

Renewable Energies: The Big Opportunity

With the rise of data storage and AI, energy demand in Europe will increase significantly. It is estimated that data infrastructure will account for up to 3.2% of electricity supply by 2030. Solaria, Acciona Energía, and Endesa will benefit especially, with robust potential despite declines experienced in 2024.

Persistent Global Risks

The probability of recession in the US and worldwide is estimated at 45% for 2025, stemming from weakening employment and demand slowdown. Gold prices, which rose over 20% in 2024 with a projection of $2,700 per ounce in 2025, reflect concerns about instability and promote defensive behavior in stock markets.

EU Tailwinds

The massive investment plan in digitalization and decarbonization proposed by the European Commission provides a significant boost for key sectors: renewable energy, technology, and infrastructure. With support from the private sector, these stimuli can contribute to the resilience of the Spanish market, offering long-term opportunities despite volatility.

Historical Performance of the Ibex 35: Lessons from the Past

The Ibex 35 has shown significant volatility, with years of substantial gains (2022 with +22.76%) alternating with sharp corrections (2019 with -15.45%). This variability reflects sensitivity to global economic cycles and external shocks.

Volatility: A Defining Characteristic

The Ibex 35 is known for higher volatility than other European indices, attributed to high exposure to cyclical sectors like banking and energy. The range of annual fluctuations reflects the index’s capacity to experience significant highs and worrying lows over short periods. During crises, it suffers sharp declines; during booms, rapid recoveries. This bipolarity presents both risks and opportunities for traders and investors.

Key Drivers in 2024–2025

Banking: Shares of Sabadell (+68%), CaixaBank (+43%), Bankinter (+34%), and Unicaja (+30%) led gains leveraging high rates. Future performance tied to ECB decisions.

Inditex: The largest component by market cap, has gained 33% year-to-date. Near historical highs, maintaining positive expectations for year-end.

Consumer and Industry: Relative robustness amid a context where domestic consumption and European recovery funds sustain a buying sentiment.

Relative Valuation: A Comparative Opportunity

The Ibex 35 trades at an approximate PER of 12–13x, significantly more attractive than other major European indices. This relative valuation offers potential upside margin, especially if Spanish economic fundamentals stabilize and foreign flows rebound.

Conclusion: An Index at a Crossroads

The Ibex 35 in 2025 reflects a resilient Spanish economy, with dynamic sectors compensating for structural weaknesses. In the short term, it points toward lateral consolidation with potential for new highs if macro surprises turn favorable. Long-term, it balances tailwinds (renewable energies, European funds) and headwinds (bank margin compression, global volatility). For traders focused on short-term market forecasts, levels 17,000–17,200 act as critical resistance; below, supports at 16,600–16,700 provide technical control points. The index’s historical volatility guarantees regular opportunities for tactical trading, though disciplined risk management remains essential given the Spanish market’s sensitivity to external shocks.