Spain’s IBEX 35 Beats EU Benchmarks in 1H25

So far, Spain’s IBEX 35 has soared in 1H25, outperforming its EU peers. Tomorrow, 1 July, marks the start of 2H25 and a fresh six-month window to see which benchmark will finish 2025 on top.

In early trading today, the IBEX 35 was up nearly 21.5% year to date (YTD), hovering around 14,010 points. The index is approaching its historic 2007 high of 15,890, capping a strong 1H25.

Germany’s DAX is close behind with a 20.7% gain this morning, followed by Italy’s FTSE MIB up about 16.3%. France’s CAC 40 has lagged, rising just 4.21% YTD. Lastly, the Euro Stoxx 50 has advanced 9.4% so far in 1H25.

Let’s explore what drove the IBEX 35 upwards in the first half of 2025:

Spanish Banks Among Top IBEX 35 Performers

The financial sector has been one of the IBEX 35’s main drivers this year, with banks delivering standout gains.

The best performer so far has been Banco Santander [SAN.E], up 59.17% in early trading today. Bankinter [BKT.E] follows with a 44.7% surge, while Caixabank [CABK.E] has risen 40.4% YTD. BBVA [BBVA.E] trails slightly behind but still posts a robust 38.15% gain.

These increases have outpaced many European banking peers. For comparison, France’s BNP Paribas [BNP.PA] has advanced 29.3% YTD, and Italy’s Intesa Sanpaolo [ISP.I] is up 25.9%.

BBVA Pending Decision on Takeover Bid for Sabadell

In Spain’s banking sector, investors are awaiting BBVA’s decision in the coming days on whether it (and the Spanish government) will proceed with the hostile takeover bid for rival Banco Sabadell.

The BBVA board is expected to meet this week to decide whether to move forward, withdraw the offer, or challenge the Spanish government’s conditions before the Supreme Court. (Source: Efe)

The government has added conditions beyond those set by the CNMC, requiring Sabadell to stay legally separate for at least three years, extendable by two. During this period, both banks must keep independent governance, separate assets, and avoid layoffs related to the deal.

Other Hidden Gems in Spain’s IBEX 35

Beyond banks, several other Spanish companies have delivered strong performances in the first half of 2025.

Insurer Mapfre [MAP.E] has advanced 41.5% YTD, making it one of the top non-bank gainers.

In the energy sector, Endesa [ELE.E] has climbed 30.2%, while Iberdrola [IBE.E] has risen 24.5% over the same period.

Meanwhile, oil company Repsol [REP.E] is up nearly 9% YTD.

Conclusion

The IBEX 35 has posted a standout 1H25, outperforming all major EU benchmarks as banks, insurers, and energy stocks delivered strong gains.

While momentum has been broad-based, financial sector strength has been the main driver, led by Santander’s near-60% rally. BBVA’s pending decision on its Sabadell takeover could set the tone for the coming months.

According to a Fitch Ratings report issued at the end of May, large European banks have remained resilient despite weaker macroeconomic prospects and tariff uncertainty. In 2025, profitability is expected to be only slightly below 2024 levels.

*Past performance does not reflect future results.