Take 5 and come back tomorrow (3/6/24) Markets Politics Taxes PRS Hotels

None of what follows is investment advice.

Market environment: India’s choice - (Asia-Pacific markets rose as do futures for Europe and the US) – Asia-Pacific markets rose supported by the indications regarding the Indian election results, optimism on inflation and oilnbsp; and Chinese PMI figures. Futures for Europe and the US point up.

Response to the crisis: Looking for new currency - (The Junts political party threatens to bring down the Sancez government if its leader Mr Puigdemont is not elected Catalan regional president (Expansion Sat p26) – With the Catalan amnesty law having been approved by Parliament last week, one of the main prizes that the Government could offer Junts has disappeared from the equation, leaving the latter free to demand the title of regional president for its leader or withdraw its support from the Socialists at the national parliament level.? The Socialists standing up to Junts in order to have its own Catalan leader elected regional president (after all, he did come first in the regional elections) could be positive for them in the rest of Spain. But this would carry the risk of new elections.? Unfortunately, in order to have a Socialist as head of the Catalan regional government might require the central government to make further concessions in the direction of Catalan independence.

Taxes: The past is unpredictable - (Tax collection rose by €7bn (+7.3%) to €97.339bn in the Jan-Apr (Expansion Sat p27)/The Treasury expects to have to refund €11bn due to judicial decisions against the “Montoro” tax reform (Expansion p22) – Tax collection is coming along nicely in 2024 courtesy of inflation and the withdrawal of some of the tax cuts aimed at lowering inflation. Unfortunately, court decisions, many relating to reforms undertaken by the prior PP government, may undermine net collection.

Prisa: Selling the cow ?- (Sounds out the market for a sale of its Santillana subsidiary at a valuation of €1bn (OK Diario) – Selling Santillana would go a long way towards solving Prisa’s debt problems but would leave it without a cash cow and subject to the volatile media environment and a potentially changing political environment.

Hotels: Higher for longer - (Hotels face a record summer with an early bookings boom (Expansion p4) – Early indications point to continued high occupancy with close to double digit price rises, which although very strong represent a slowdown with respect to prior months, with hotel owners trying to capitalize on the outlook by extending the high season.