Habemus Papam. Donald Trump has nominated Jerome Jay Powell to presidency of the Fed starting next February. Wall Street, with a final rise, has shown its approval for the promotion of a dove. Powell, 64, a Republican, at the Fed since 2012, has always voted on rates in line with current president Janet Yellen.
The presentation to Congress by the Republicans of the tax reform plan wanted by Trump contributed to increasing the good mood. The corporate tax rate lowered to 20% from the current 35% could result in an average increase of $8-10 per share in the S&P500.
Finally, Apple's accounts arrived to cheer the markets: Apple has not only beaten expectations for both profits and revenues, but has advanced positive forecasts on upcoming Christmas sales. Only then will the first data on sales of the i Phone X arrive. In the meantime, the group achieved revenues of 30 billion dollars in the quarter ended September 52,6, up 12% (against 50,7 billion expected). Net earnings per share were $2,07, up 24%. 46,7 million i Phones were sold in the quarter (against expectations for 46 million).
During the quarter, said CFO Luca Maestri, Apple generated 15,7 billion in cash flow and returned 11 billion to shareholders in the form of dividends and buybacks. After the Stock Exchange, the stock, up by 0,7% during the day, achieved a rise of more than 3,5%, to 168,11 dollars. In this way, capitalization has overcome the barrier of 900 billion dollars.
THE APPLE ALSO PUSHES ASIA. CHINA WEAK
Apple's good performance favored Asian suppliers this morning. The Continent's lists, orphans of Tokyo closed for holidays, close the week in positive territory. Hong Kong's Hang Seng index rose by 0,2%, Seoul's Kospi by 0,1%, Mumbai's BSE Sensex by 0,2%. The CSI0,4 index of the Shanghai and Shenzhen stock markets fell by 300%. The Caixin PMI index on the expectations of purchasing managers of Chinese service companies was better than expected.
TESLA AND REAL ESTATE UNDER FIRE
The announcement of the tax reform and Powell's appointment to the Fed didn't excite Wall Street too much, waiting for the jobs data to arrive today. Weak real estate: the market fears the abolition of purchase incentives. The Dow Jones closed up 0,35%, the S&P 500 index moved little +0,02%. The Nasdaq decreased slightly, -0,02%.
The dollar weakened against the euro, to 1,165 from 1,162 the day before. Treasury bills moved little, the 2,34-year bond fell to 2,36%, from XNUMX%.
Highlights Boeing, 3M and Goldman Sachs. Tesla (-6,8%) under fire for the serious delays in the production of the Model S and Facebook (-2%), invested by investigations into hoaxes on the Net.
The rise in oil continues. Brent traded at 60,7 dollars a barrel this morning, up 0,2%, yesterday it closed at 60,6% (+0,2%).
BUSINESS PLACE ABOVE 23 THOUSAND. THE SPREAD OVER SPAIN AT 32 POINTS
Contrasted closure for the European stock exchanges despite the excellent data arriving for the manufacturing sector in the euro area: October was the strongest month since the beginning of 2011.
Piazza Affari (+0,24%) consolidates its gains, closing beyond the barrier of 23 points (Ftse Mib index at 23.046 points). Fractional losses for Frankfurt (-0,18%), which moves away moderately from the top reached yesterday.
Paris stable (-0,07%). The French state has announced the sale of 4,73% of the capital of Renault of which it will remain, as expected, the first shareholder with 15,01%.
Madrid falls (-0,47%). A Spanish judge today ordered eight Catalan secessionist leaders to remain in pre-trial detention until trial. A European arrest warrant has been signed for ousted Catalan leader Carles Puigdemont.
Outside the eurozone, London gains 0,9%. The pound suffered the worst depreciation against the euro in the last three months (-1,7% to 0,892) after the BoE's decision to raise rates from 0,25% to 0,5%, for the first time in ten years. The British central bank is planning two more hikes in the three-year period 2018-2020, but its forecasts are very cautious, especially due to the uncertainties related to Brexit.
The recovery of Italian stocks continues. The Italy-Germany spread reached a minimum of 141 basis points in the session, the lowest level since the end of October 2016. The yield on the 10-year BTP is 1,8%.
The yield differential between the ten-year Italian and Spanish benchmarks went as high as 32 basis points in the session, reaching its lowest level since the beginning of December 2016. Yesterday Madrid placed 4 billion nominal bonds and almost 600 million index-linked securities, while Paris assigned over 8 billion on three Oats.
TENARIS, PROFIT DOUBLE THE FORECAST
The leading stock on Piazza Affari was Tenaris, up 9,8%. The producer of special pipes for the oil industry announced that it closed the third quarter of 2017 with a net profit of 105 million dollars, double the figure estimated by analysts. Adjusted Ebitda climbed 43% year over year to $225 million. The achievement of the targets has been confirmed by the company, thanks to the improvement expected in the last part of 2017.
The company expects sales in the Americas (both North and South) to continue growing in the fourth quarter and throughout 2018. Mediobanca rewarded the quarterly, confirming the Outperform recommendation and the target price at 18 euros. The stock is still down 24% year-to-date. The other stocks in the sector were positive: Eni +0,5%, Saipem +1,1%.
BENEFIT TAKES ON FERRARI. FCA SALES UNCHANGED
On the other hand, Fiat Chrysler (+0,8%) is lagging after the sales figures for October. The company recorded a 13% drop in registrations in the United States, compared to -9% in the market. The downturn is slightly worse than expected, but the mix is positive. In Italy, against a market that grew by 7,10% compared to the same month in 2016, sales were unchanged. Unchanged: 41.200 vehicles, with a market share of 26,1%. In the period January-October 2017, sales were 486.100 cars, with an increase of 8% compared to 2016, and a market share of 28,7%.
Setback for Ferrari after the extraordinary rally of the last few days. Profit-taking started on the day of accounts, so the Reds fell sharply by 3% to 100,70 euros, after having set new all-time highs at 105,30 euros at the start of the session and having dropped to a minimum of 99 euros. In the conference call Sergio Marchionne argued that the estimates for the year, revised upwards, are feasible and conservative, and promised to increase margins in the new business plan. “But it is not even remotely imaginable to think of arriving in the future with a number of vehicles produced comparable to that of Porsche”, explained the CEO.
BASEL 4 REWARDS ITALIAN BANKS. UNICREDIT STARTS AGAIN
The recovery of the banking sector contributed to supporting the market, up by 0,75% against a European sector with little movement, despite the positive accounts of Credit Suisse. The Bank of Italy has communicated that an agreement has been found on a part of the new rules regarding bank accounting. The Basel 4 committee has established a threshold for the maximum benefit deriving from the adoption of internal models for the calculation of assets. Good news for Italian banks that already apply very prudential accounting, while the hardest hit will be the banks of Northern Europe. A substantial study by Credit Suisse has benefited the sector, claiming it is "selectively constructive" on Italian banks.
UniCredit +1,8%. The group announced that the sale of the 17,7 billion euro of non-performing loans continues in line with the indications already provided.
Ubi Banca +1%. Credit Suisse has initiated coverage with an Outperform rating.
B for Bank +3,6%. KBW raised the target to 6,40 euro, Outperform rating.
Only Banca Monte dei Paschi falls (-0,6%). Credit Suisse initiates coverage with an Underperform rating.
TELECOM, GOLDEN POWER ALSO ON THE NETWORK
In the rest of the price list Telecom Italia, +1,5%, should be noted. Yesterday the Council of Ministers approved the exercise of the Golden Power on the grid, which concerns the maintenance of investments and the correct functioning of the infrastructure. In mid-October, the Government had already approved the exercise of Golden Power over Tim and its strategic defense and security subsidiaries Sparkle and Telsy. Mediaset closed down 2,2%.
Among the medium caps, real estate securities are still in evidence after the extension of the PIR to the sector. In particular, Igd (+4,82%) was highlighted.
