This article comments on the changes of the Spanish main Stock Exchange Index, the Ibex 35 over the period from 2000 to 2006.

A main stock index provides information about same basic structure of a country.

The article The IBEX 35 Index From Raw Data to Useful Information shows the distribution of companies amongst the various sectors and these sectors are taken as a starting point for this comparison..

There have been some shifts both in the relative weight of certain companies on both years and a significant number of companies left or merged (fourteen) and nearly an equal number of companies entered (thirteen). The business newspaper “Cincodias” (www.cincodias.es) provided an overview of the companies listen on the Ibex 35 in 2000 and 2006.

At the top of the index, there have been minor changes, although you should remember that the year 2000 was during the last phase of the new-economy trend. The market capitalization of Telefonica was about 10,6 billion euros and represented 28% of the Ibex 35 index. And Terra which is now part of Telefonica represented another 3,4 billion euros (9% of the Index in 2000). The market capitalization of Banco Santander nearly doubled in this period and this bank has now the highest capitalization.

Companies (Stocks) that left the stage (present in 2000 but not in 2006) are:

• Terra (communication sector),
• Amadeus (producer of airline systems),
• Alba (Real estate Promotion),
• Acesa (Road Infrastructure),
• Pryca (Consumer Retail),
• Agbar (Aquas de Barcelona – a water utility company),
• Sol Melia (Hotels),
• Hydro Cantabrico (Water Utility),
• Telepizza (Food),
• Dragados (Construction),
• Continente (Consumer Retail),
• Aceralia (Commodities – Steel),
• Aumar (Road Infrastructure),
• Mapfre (insurance) and
• Vallehermoso (Construction)

From these, the companies Pryca and Continente have merged. Vallehermoso has merged with a company that was (and still is) also in the Ibex 35: Sacyr. Dragados merged with the ACS group, which is still in the index.

Companies that entered the stage (which are only on the list of 2006) are:

• Arcelor (Commodities -Steel),
• Inditex (Textile),
• Abertis (Infrastructure and Communication),
• Banco Sabadell (Finance),
• Metrovacesa (Construction & Real Estate),
• Telefonos Moviles (Communication),
• Sacyr Valle. (Construction -the merger of Sacyr and ValleHermoso),
• Gamesa (Wind energy),
• Cintra (Infrastructure),
• Telecinco (TV, Entertainment),
• Antena3 TV (TV, Entertainment) and
• Iberia (transport).

At the moment, Telefonica is selling TPI (which market capitalization decreased from 8 billion Euros in 2000 to about 3 billion in 2006) in order to finance it recent acquisition of O2, the British telecommunication provider.

For one part, the shift shows a normal development similar to other countries after the new-economy in which the presence of Telecommunication is diminished. Although (water) utility companies left after 2000, new utilities entered and the presence of construction companies is still significant.

© 2006 Hans Bool

Hans Bool is the founder of Astor White a traditional management consulting company that offers online management advice. Astor Online solves issues in hours what normally would take days. You can apply for a free demo account