After the setback of the previous session, the IBEX 35 stock index started August with a downward trend on Thursday, as the decline in the heavyweights of the banking sector counteracted hopes of rate cuts in the United States.

Santander lost 1.53% and BBVA fell 1.85%, becoming the biggest drag on the Spanish selective index.

These cuts were overshadowed by the comments of Jerome Powell, chairman of the US Federal Reserve (Fed), who opened the door to monetary easing in September, news that was welcomed by the market, but largely already discounted.

"The central bankers' meeting in Jackson Hole (Aug. 22-24), with new data in hand, could be the forum to explicitly announce the start of rate cutting in September," said brokerage house Renta 4.

"Powell's message, while very much in line with expectations, led to a significant moderation in IRRs (yields in the debt market). Minimal movements in the dollar and in the stock markets, which after an initial upward reaction unwound the movement (fear of an excessive slowdown in the labor market?)," added these analysts.

On the macroeconomic front, the focus was on the PMI surveys of activity in industry, as well as on the final stages of the corporate earnings season.

On Thursday, the shares of Cellnex and Fluidra appreciated by almost 4% in both cases after presenting their quarterly accounts.

At 0721 GMT on Thursday, the selective Spanish stock market index IBEX 35 fell 77.70 points, or 0.70%, to 10,987.30 points, while the FTSE Eurofirst 300 index of large European stocks fell by 0.25%.

In the banking sector, Caixabank gave up 1.19%, Sabadell fell 2.33%, Bankinter dropped 1.80% and Unicaja Banco lost 1.69%.

Among the large non-financial stocks, Telefónica fell 0.02%, Inditex advanced 0.29%, Iberdrola dropped 0.53%, Cellnex gained 3.39%, and the oil company Repsol rose 0.46%.

(Information by Tomás Cobos; edited by Benjamín Mejías Valencia).