Madrid — BME and the Spanish Cyclical Market

BME Madrid is home to three of Europe's most interesting cyclical companies: Repsol (oil), Iberdrola (renewable energy) and Ferrovial (infrastructure). Each responds to a different macro signal — but all follow the same logic: buy the cycle lows, sell the cycle highs.

The IBEX 35 as a Cyclical Index

The IBEX 35 is Spain's leading stock index and more cyclically sensitive than commonly understood. Energy, industrials and financials together account for over 50% of the index. Madrid is therefore one of the most interesting markets for cycle-oriented investors in Southern Europe.

The three Signycle-tracked Madrid stocks represent three distinct cycle expressions: Repsol follows the Brent crude oil cycle, Iberdrola follows the EUR 10-year rate (renewable energy cycle) and Ferrovial follows the Global Manufacturing PMI (infrastructure investment cycle).

Repsol: The Brent Cycle

Repsol is Spain's largest integrated oil company. The Brent signal (buy below $50/bbl, sell above $108/bbl) was highly reliable in the COVID cycle: +100% in 27 months from March 2020 to June 2022.

Iberdrola: The Rate Cycle

Iberdrola is Europe's second-largest renewable energy company. The EUR 10-year rate (buy below 1.5%, sell above 3.0%) directly drives the project economics of wind and solar energy. From October 2012 to July 2021, Iberdrola delivered +188% — one of the longest and most powerful cycles in the Signycle universe.

Ferrovial: The PMI Cycle

Ferrovial is a global infrastructure operator with motorways, airports and construction projects. The Global PMI (buy below 49, sell above 53.5) captures the appetite for infrastructure investment. The 2015–16 PMI cycle generated +21% in 13 months.

How to Follow Madrid Signals

The three Madrid signals can fire at different times — Brent and EUR rates are independent of PMI. A Madrid investor can run all three in parallel, sizing positions according to signal strength and personal risk tolerance.