Morgan Stanley apuesta por comprar en las caídas de la deuda española

Morgan Stanley is betting on buying Spanish government debt during the downturns, regardless of the political uncertainty stemming from the early electoral advance in Spain. Several investment firms have recently pointed out that fixed income is starting to offer attractive entry levels. Spain's public debt is not an exception if it registers new deleveraging, according to Morgan Stanley.

The "buy the dip" strategy is not exclusive to the variable income market; it can also be applied to the Spanish debt market during the current turmoil. Investors have been targeting Spain's public debt as the epicenter of fiscal alert in Europe. Fear of contagion was added to the mix last Monday by the additional uncertainty caused by the early electoral advance announced in Spain.

Fixed income investors are particularly reluctant to uncertainty. Spain's public debt initially reacted negatively, with a predominance of sales on Monday, resulting in a drop in the price of 10-year bonds and an increase in the required interest rate, reaching 4.15% by the close of trading. Yesterday's session corrected this deterioration, with early trading intraday lows just under 4.10%, and Spain's risk premium returning to levels very close to the 61 points basic recorded on the previous Friday, the day before the electoral advance announcement.

Any further downturns could become buying opportunities, according to Morgan Stanley analysts. The U.S.-based firm believes that Spain remains an attractive option within the eurozone fixed income market, as it is unlikely that political uncertainty will generate enough macroeconomic volatility to question the country's image of stability.

In fact, Morgan Stanley sees it more feasible to achieve rating upgrades than downgrades. Looking ahead, there is room for further improvements in Spain's credit rating in 2027. With these premises in mind, Morgan Stanley confidently asserts that it would consider any downturns in Spanish bonds as an opportunity to increase exposure, as long as the decline is caused by an increase in the yield of Spanish bonds due to specific Spanish factors, rather than general movements in the eurozone market.

Morgan Stanley identifies two pillars that could provide support in any downward episode. The firm highlights that both non-eurozone investors and banks can play a key role in absorbing the supply of Spanish public debt.