June in Charts-Spain’s IBEX soared and much more

Another month, another risk on/risk off chartology presented. Courtesy Thomson Reuters.

The first half of 2012 is over – and the risk on/risk off trade is still alive and well.

There’s nothing like a spot of volatility to keep investors on their toes.

June was marked by a continuation of the markets’ recent obsession with events in Europe, but with a greater dose of unpredictability, both in terms of the news flow and how investors chose to respond to it. For instance, one of the best-performing asset classes was Spanish equities, which benefitted first from some bottom-fishing when that country’s government finally requested bailout assistance for the country’s troubled banks. Spain’s stocks ended the year with a bang, rallying on the final trading day of the year when word came that eurozone political leaders had reached an agreement to funnel financial support to troubled banks without adding to sovereign debt loads.

For all those that still think Spain is just going down, sorry. IBEX put in a stellar performance last month, managing squeezing many of those “smart” new shorts.

Risk off – risk on again? Certainly, investors seemed less risk averse than they did in May, as Spanish equities led many other asset classes, posting a dramatic rally off their recent lows. Even Spanish bonds eked out some modest gains, perhaps encouraged by the bailout proposals late in the month. Meanwhile, while copper prices regained some ground, crude oil was among the biggest losers for the month, despite the fact that a boycott of Iranian crude will begin with the new month.

full must see graphics click here.