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Stock Market Closes January 13: US Big Tech Under Pressure and Wall Street Erases Trump Effect but Oil and Dollar Run High

Markets are anxiously awaiting the new US inflation reading and the quarterly results of American banks, but anti-China restrictions on chips are taking the momentum out of Nvidia and high tech

Stock Market Closes January 13: US Big Tech Under Pressure and Wall Street Erases Trump Effect but Oil and Dollar Run High

The European financial week opens with a session in the red for both stocks and bonds, with the recovery of energy prices raising concerns about inflation and consequently about monetary policy. On exchange rates, it is still superdollar, while oil and gas prices soar.

Thus Business Square loses 0,83%, falls back to 34.799 basis points and closes the session a little worse than Amsterdam -0,56% Frankfurt -0,4% London -0,31% Paris -0,3% Madrid -0,3%.

BTP-Bund spread widens, but Gilts plummet

On the secondary market, it also increases spread between the Italian and German decennials, with the returns upward trend across Europe. The spread between the two benchmarks is now at 124 basis points, from 121 last Friday, and rates are at 3,83% (from 3,76%) and 2,59% (from 2,57%) respectively. Italian paper yields are also rising on the primary market in the Treasury auction for BTP at 3 and 7 years for a total of 5,75 billion euros.

The picture for the Eurozone is still rosy compared to the British situation: the Ten-Year Gilt sees the yield approaching 5% (4,933) and the spread widening beyond 235 basis points. The English paper is still weighed down by the market's mistrust of the government's ability to keep its accounts in order, in a context of a struggling economy and persistent inflation. Trying to ease these tensions, Prime Minister Keir Starmer reiterated today that Great Britain will adhere to the fiscal rules established in the October budget of the Minister of Finance Rachel Reeves.

Wall Street Mixed, But T-Bonds Soar  

Furthermore, caution is being felt in Europe due to the negative trend in Wall Street, which also saw a jarring opening bell today, then took a contrasting trend, with the DJ timidly rising and the Nasdaq sharply falling. While Los Angeles continues to burn and the United States prepares to face the most expensive disaster in its history, the New York indices have practically erased their gains since Donald Trump's victory in the elections. The tycoons will be installed in the White House in exactly one week's time and it is not known what the impact on the markets will be if many electoral promises are kept, starting with the tightening of tariffs in every direction. 

In the meantime, the United States on the one hand is enjoying a still very strong economy, on the other hand they fear that the Fed will be able to cut rates at most once this year or even never if instead of a soft landing the economy continues to demonstrate that it is flying higher and higher. Proof of this is the brilliant employment report for December seen last Friday, which adds further specific weight to the inflation data due out on Wednesday.

Today, stocks are seeing huge sales Chip sector stocks and in general across the tech sector, after the Biden administration announced new and broad restrictions on the export of advanced artificial intelligence chips produced by Nvidia and other companies, with the aim of limiting their sale to countries not allied to the United States. The big banks are moving cautiously as they begin their earnings season in the coming days. 

Furthermore, the propensity to risk is curbed by the government bond yields, which in a context of rates that could decrease in the longer term, see yields rise. Even today the ten-year is slightly growing, close to 4,8%.

Euro-dollar below 1,02, pound plunges

With Donald Trump now close to taking the reins and the Fed reeling from data, the dollar continues to strengthen against major currencies. The trajectory euro-dollar seems to be heading towards parity. At the moment the single currency is trading below 1,02 at 1,0193. 

La GBP is still the most penalized today and sees a loss of 0,5% for a cross at 1,214. On the British currency there has been a "300% increase in requests for trading as hedge funds are betting on a further decline", explains to Bloomberg Mimi Rushton, global head of currency distribution at Barclays.

Among the raw materials, the money is confirmed Petroleum. Brent and WTI March futures are moving sharply higher today, with the former trading above $81,30 a barrel (+1,97%) and Texas crude at $77,45 (+2,24%).  

Both contracts have risen about 7% since January 8, after the U.S. Treasury imposed broader sanctions on Russian oil. The new sanctions target producers Gazprom Neft and Surgutneftegaz, as well as 183 ships that transported Russian oil, targeting the revenues that Moscow used to finance the war with Ukraine. Meanwhile, news from Moscow comes that Gazprom is considering cutting 1600 jobs in its central office in St. Petersburg to cover part of the losses due to sanctions.

Today they also raise their heads again gas prices, with futures in Amsterdam shooting towards $48 per MWh.

Piazza Affari tries to limit the damage with Amplifon, oil stocks and banks

Piazza Affari defended itself today with purchases in energy stocks and banks. However, it leads the list Amplifon +2,5%, also thanks to the promotion of Intermonte to “outperform”.

Among the energetic ones they shine Tenaris + 0,98% Snam + 0,098% Eni + 0,93% Terna + 0,11%.

Banks are looking more favourably at a higher cost of money and are timidly increasing their rates Unicredit + 0,75% Bper + 0,67% Bpm bank + 0,3%.

Be careful when purchasing on Telecom Italy, +0,31%, on the day of the judge's ruling on the legal dispute brought by Vivendi against the manner in which the Tim board of directors approved the sale of NetCo. Well in luxury Moncler + 0,6%.

The biggest losers in blue chips are nexi -3,85% Prysmian -3,07% Ferrari -2,77% stm -2,6%.

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