Spain’s benchmark closed on Wednesday at its highest since January 2010, following a rally of over 18% so far this year, outperforming other European indexes.

Equities have hit multi-year and even record highs this year, as central banks cut interest rates and inflation subsides, while growth in the United States has remained robust.

“Investors remain confident about a soft landing for the economy and are currently looking at the third-quarter corporate earnings which are likely set to return to growth”, market analyst Joaquin Robles said.

Some European indexes, such as the benchmark STOXX and Germany’s DAX have been recently trading near all-time highs.

Madrid’s IBEX index has been the best performer among the European indexes this year, followed by Germany’s DAX and Italian’s FTSE MIB, which have gained 16% and 14%, respectively.

It closed at 11,996.7 after briefly touching 12,005.1 shortly before the close.

France’s CAC has fallen 0.6% year-to-date, as political turmoil has prompted investors to sell the country’s bonds and stocks.

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However, Spain’s IBEX is far below its all-time record of almost 16,000 points, set in November 2007.

Madrid equities have benefited from a heavy weighting towards bank stocks, which tend to lag when interest rates fall, but which have seen bumper returns from investment banking.

On the IBEX, lenders such as Sabadell and Caixabank are among top gainers in 2024, rising 67% and 47%, respectively.

Robles also pointed out that Spain has been growing faster than the euro zone average in the last two years and therefore it was raising more optimism among investors.

The Spanish government last month raised its economic growth forecasts for 2024 to 2.7% from 2.4%, while the euro zone is expected to grow a scant 0.8%, according to European Commission data.