Analyst says Spanish election outcome may affect markets if it leaves no clear winner

Spain is due to hold an early election on November 29.

Antonio Castelo, an analyst at iBroker, says past elections have not usually hurt the Spanish stock market: the Ibex rose between the announcement and the vote in seven of ten cases since 1996.

He says there is currently no sign that investors see greater political risk in Spain, while markets are paying more attention to France and Italy.

But a result with no clear winner could shift attention to Spain, especially because governments would be dealing with high public debt and deficits.

Castelo says he is more concerned about instability in bond markets than about the election itself.

He identifies Inditex, Iberdrola and ACS as companies whose international business or financial strength may help them weather the political uncertainty.

Investors will be watching the election result and whether it produces a stable government.