The markets rallied at the start of 2018, driven by the positive impact of the tax reform approved in the US. However, this positive mood then dissipated over the following months on the back of increased stock market volatility mainly due to:

• The political and economic instability in Italy and Brazil. In Italy's case, this was due to the make-up of the government and the presentation of a budget deficit target that breaches Brussels' rules. In the case of Brazil, the uncertainty stemmed from October's presidential elections.
• The failure to reach an agreement in the Brexit negotiations.
• The rise in financial tensions in emerging economies due to the dollar's appreciation, with a marked impact on currencies such as the Turkish lira, the Brazilian real and the Mexican peso, after the Fed and the ECB continued with their policy of monetary normalisation. The Fed raised interest rates while the ECB announced the end of quantitative easing, with a first interest rate hike forecast after the summer of 2019.
• The ramping-up of trade tensions between the US and China and the potential impact on the global economy and confidence.
• Fears of a slowdown in global growth, along with the partial US government shutdown, which aggravated the declines in the latter part of the year.

Against this backdrop, the leading share indices and the Santander share price ended 2018 down. Santander share price (-27.5%), Euro Stoxx Banks (-33.3%), Stoxx Banks (-28.0%), Ibex 35 (-15.0%), DJ Stoxx 50 (-13.1%) and MSCI World Banks (-19.7%).

On 31 December, Banco Santander was the number one bank in the Eurozone and the sixteenth-largest bank in the world by market cap – at EUR 64,508 million.

Its stock weightings in the DJ Stoxx 50 and DJ Stoxx Banks stood at 1.94% and 7.98%, respectively. On the Spanish market, its weighting was 14.52% in the Ibex 35 index.

In 2018, 19,040 million Santander shares were traded, for a cash amount of EUR 95,501 billion—the highest volume for any Euro Stoxx constituent—with a liquidity ratio of 118%. An average of 75 million shares were traded daily, for a cash amount of EUR 375 million.

Source: Bloomberg and Madrid Stock Exchange at 31/12/2018.