A new torpedo hits the markets. The Tech giants have come under fire from the US authorities: Alphabet falls to its lowest level in the last five months, down 6%, due to rumors about the opening of an investigation by the US Department of Justice for abuse of dominant position. Instead, Amazon (-4,6%) and Facebook (-7,5%) ended up in the sights of the Federal Trade Commission. Same fate for Apple, only -1,1%, which just yesterday announced that i Tunes (the app launched in 2003 to sell songs and which now has 50 million songs and about 100 between films and TV series) will split in three: Apple Music, Apple Podcasts and Apple T.
However, the offensive by the US authorities only had an effect on the Nasdaq, down by 1,6%, but did not affect the other US markets, which are almost immobile despite the negative signals coming from the data on the trend of manufacturing activity: Dow Jones +0,02%, S&P 500 -0,28%.
T-BOND IN THE FLIGHT: THREE RATE CUTS DISCOUNTED IN 2019
The depressed economic situation, combined with an increasingly hotter geopolitical situation (Secretary of State Mike Pompeo recalled the 30th anniversary of Tien An Men with an incandescent note), continues to favor the migration of capital towards fixed income. The yield on the 2,07-year Treasury Note hit a low of 2010% last night. The market is pricing in at least three interest rate cuts by the Federal Reserve between now and XNUMX. St Louis Fed President James Bullard said last night that there is a need to lower rates. This afternoon, it could be Jerome Powell himself who sheds light on the central bank's intentions.
DAZI, MEXICO SEEKS TO AGREE WITH THE USA
In this climate, the markets are advancing without momentum, worried by the various hotbeds of crisis: not just China. Today the negotiations on duties and immigration begin in Washington between the leaders of the White House and those of Mexico. And the Indian front is picking up intensity, following the US decision to review trade agreements with New Delhi.
CHINA WEAK, OIL STILL DOWN
China's stock markets are down this morning (CIS 300 -1%, Hong Kong -0,5%), a modest rise for the Seoul Kospi index.
The stock exchanges of Japan are slightly below parity. In the last few hours, the rally of the yen has lost momentum, the safe haven currency of Asia is at its highest level since the beginning of the year. The cross with the dollar reaches 108.
Gold calms down after yesterday's rally, at 1.322 dollars a barrel.
Brent oil still down, but also thanks to the change in the reference value, this morning we are at 61 dollars, yesterday -5%. Eni and Saipem gained more than 2%, favoring the recovery of the Ftse Mib index which yesterday celebrated its tenth birthday.
The euro appreciates for the third consecutive day to 1,123 against the dollar.
BTP, THE MARKETS LIKE THE PREMIER'S ULTIMATUM
“No more fighting or I'm leaving”. Prime Minister Giuseppe Conte yesterday launched his ultimatum, already disregarded by new disagreements on the construction site release decree. But the intervention has had a positive effect on the markets, because Palazzo Chigi has clearly reiterated that it has no intention of unilaterally breaking with the EU rules on public finances.
Waiting for Giuseppe Conte press conference, set 45 minutes after the close of the markets, the Milan Stock Exchange closed with a slight increase, recovering from the large decline of the morning. The relative stability of the Italian manufacturing sector in May also favored the rebound, dropping for the eighth consecutive month, but less than expected, to 49,7, the best reading in eight months. But, three days after the ECB meeting, the stock lists reflect the worries about the escalation of the trade war which is now threatening the entire global supply chain with repercussions on growth.
Milan (+0,16%) thus closed the session slightly up at 19.874 points, recovering from a low of 19.593.
The other European markets also recovered in the afternoon: Madrid +0,2%; London +0,35%. Frankfurt (+0,55%) recovered the accumulated liabilities after the news that Infineon (-6,6%) reached an agreement for the acquisition of the US company Cypress Semiconductors at a value of over 9 billion euros, including debt, about 30% more than Friday's quoted prices. Stm, down in the morning, closed at +0,58%.
FCA-RENAULT, TIME FOR CHOICE. BUT NISSAN DOESN'T DECIDE
Paris +0,65% on the eve of the board of directors of Renault (+0,61%) which will have to pronounce today on the merger offer with Fiat Chrysler. The French government, a major shareholder of the house, is ready to make various requests: the location of the headquarters of the new group in France and an extraordinary coupon for Régie shareholders as already foreseen for Exor. Macron also claims a seat on the board for the French state of the four foreseen for Renault and guarantees not to touch jobs for a period of four years instead of two. Nissan, for now, has decided not to decide pending details on the operation.
THE SPREAD FALLS TO 278, THE XNUMX-YEAR RATE DECREASE
While waiting for Prime Minister Conte's press conference, the BTPs closed in positive territory, after the trend reversal in the morning, when the spread rose to 296 points and then fell to 278.
The 2,58-year rate closed in the 2,66% area from XNUMX% in the previous session, benefiting, albeit only in part, from risk aversion due to the worsening of tensions on world trade which led to general purchases of bonds.
DIASORIN AND THE UTILITIES SHINE
Among the best blue chips, Diasorin stands out (+3,7%) thanks to Bofa's Buy, which has started hedging with a target price of 111 euros. The US bank speaks of defining Diasorin as a high-quality asset, with organic revenue growth in the order of 7%-8%. Furthermore, according to analysts, the market underestimates the growth opportunities of Liason XL/XLS, without forgetting that the title has low valuations compared to its competitors.
Utilities follow: Enel (+0,79%) completed the sale of 100% of three renewable plants operating in Brazil, collecting approximately 660 million euros. Out of 31 analysts surveyed by Bloomberg, as many as 26 recommend buying. A2a closed at +0,75%, behind Snam (+0,91%), Italgas (+1,2%) and Terna (+1,39%).
CONTRAST THE BANKS, DOWN MEDIASET
Analysts on the move also on the car after a difficult week (Eurostoxx -14% for the sector).
Sales still down in May in Italy. The motorisation registered 197.307 cars, with a change of -1,19% compared to May 2018.
Pirelli unchanged. Berenberg raises the judgment to Hold, from Sell. Brembo -3%. Ferraris -0,3%.
Contrast the banks, negative but above the minimums. Credem -1,9%: Fitch confirmed its long-term rating at 'BBB' with a negative outlook.
Banco Bpm (-1,5%) could buy assets in Northern Italy, CEO Giuseppe Castagna said in an interview published over the weekend. In the new industrial plan there should be room for growth through acquisitions. An aggregation will probably be "inevitable", Castagna said when answering the question of whether a possible aggregation will be a chapter in the industrial plan expected in the autumn. Weak management. Fineco Bank and Banca Generali fall, both -1,33%
Juventus (-2,7%) was also under fire, correcting Friday's strong gains justified by the return of rumors about Pep Guardiola's arrival.
Fincantieri increased (+2,2%) on the wave of anticipations on the birth by the summer of a joint venture with the French group Naval Group. Leonardo also rises driven by expectations of orders and growing results.
Mediaset falls another 2,1% (-13,5% in one month). Goldman Sachs announced that it has resumed coverage of the stock with a Sell rating and a target price of 2,49 euros (against a price of 2,5640). The general meeting of Prosiebensat.1, the German broadcaster in which Mediaset bought 9,6% at the end of May, will take place on June 12: in that meeting it could be revealed whether the management supports Mediaset's plan to create a player large European.
Of note are the leaps by Gima Tt (+5,42%) and Elica (+2,22%): Banca Imi has reduced the target price from 2,9 to 2,8 euros, confirming the buy recommendation.
