The Spanish stock market index Ibex-35 deepened its downward trend on Friday and lost the psychological level of 9,100 points, reaching its lowest level since May, due to the preference for safe-haven assets in the financial markets.

In a context of fear that the conflict between Israel and Hamas could spread to other countries in the Middle East, investors preferred not to take long positions in equities due to the uncertainty of the possibility of new episodes of violence during the weekend.

Geopolitical concerns were compounded by selling in the bond market, which pushed US benchmark yields to their highest levels since 2007, due to fears about the high US public deficit, the abundant supply of debt securities and the prospect of high interest rates for a prolonged period.

On Thursday, Federal Reserve (Fed) Chairman Jerome Powell made a statement suggesting that, although the strength of the US economy may justify further interest rate hikes, the bond market was helping to tighten financing conditions and thus control inflation.

These comments reinforced the idea that the Fed will choose not to raise rates at its next policy meeting.

Renta 4 securities house highlights the recent "mixed reception to (corporate) results depending on pricing power" and notes that there will be interest in "Italy's rating review by S&P, with downgrade risk or put on negative watch following the shift towards a looser fiscal policy."

Against this backdrop, the Ibex-35 saw the level of 9,000 points in danger, the loss of which would place the selective at its lowest level since March 24.

At 07:39 GMT on Friday, the Spanish selective stock market index Ibex-35 fell 87.90 points, or 0.96%, to 9,058.90 points, while the FTSE Eurofirst 300 index of large European stocks fell 0.88%.

For the week as a whole, the Ibex-35 shows a decline of 2.01%, its fifth consecutive weekly drop and the steepest decline since the week ended August 4.

In the banking sector, Santander lost 0.74%, BBVA fell 0.84%, Caixabank dropped 0.96%, Sabadell fell 0.49%, Bankinter dropped 0.44% and Unicaja Banco rose 0.30%.

Among the large non-financial stocks, Telefónica fell 3.10%, Inditex dropped 0.24%, Iberdrola lost 0.77%, Cellnex fell 0.51%, and the oil company Repsol lost 0.50%.

Grifols was in negative territory, with a fall of more than 3%, after announcing a "clawback" policy for the recovery of remuneration erroneously granted to group executives.

(Information by Tomás Cobos, edited in Spanish by José Muñoz)