BIG DEMAND FOR BOTS. THE THREE MONTHS BELOW 2%
THE INCREASE OF FONDIARIA -5% WILL BE OF A BILLION
The Monti effect gives oxygen to Business Square and other European Stock Exchanges. The positive outcome of the Bot auction made it possible to contain losses after a difficult start: the FtseMib index, which dropped by 10,30% at 0,5, is practically unchanged -0,02% at 16.108. %. London -0,13% and Paris -0,05% almost zeroed losses, Frankfurt salt of 0,3%.
Il Tesoro has successfully placed government bonds shortly for 11 billion euro. In detail, 8 billion three-month BOTs were placed at a rate of 1,969%. The request exceeded the offer by 1,34 times. Prior to the auction, securities of similar maturity were trading on the market at a yield of 2,00%. 3 billion Bots maturing December 2012 were then sold at a yield of 2,21%. The demand had been equal to 5 billion. After the auction, the yield on the ten-year BTP fell by 9 basis points to 5,93%, the spread with the German Bund narrowed to 405 points.
“Investing in Italian government bonds which, in a phase of deflation, yield around 6% on ten-year maturities, is a fantastic but also very dangerous opportunity”. This is the opinion of George Soros interviewed by Reuters TV in Davos. “Facing a period of deflation and being able to have a 6% yield on Italian ten-year bonds means having a fantastic yield, which will not remain at these levels when things settle down,” said Soros, who recently invested 2 billion dollars of Italian securities already owned by MF Global. “But it is a very risky speculation, since if things go wrong, the yield could rise to 10%, then a large part of the invested money would be lost”.
Before letting our guard down, however, we need to look to the hotbeds of sovereign debt crises, far from extinguished. In Athens, where a new round of negotiations is underway on cutting of the Hellenic bonds, there is an air of optimism: major Greek banks are up sharply. Alpha Bank gains 20%, EFG Eurobank +25%, Piraeus Bank +23%. But a new emergency front is opening up: Portugal. Credit-default swaps on Portuguese debt soared to record highs this morning reaching 1.430 basis points, up 53 basis points from yesterday. Record also for the ten-year spread, for the first time since the birth of the euro at over 1.300 cents.
The banking sector recovers, but only partially: MontePaschi drops by 2%, Unicredit retreats 1,6%, Banco Popolare -1,3%. Going against the trend, Intesa + 0,75%. Strong rise by Ferragamo +4,2% after the buy of Deutsche Bank and better than expected results. Fondiaria-Sai loses 4,96% on rumors of a forthcoming capital increase heavier than expected. The capital increase could in fact rise to 1 billion from the 750 million already approved by the company's board of directors. This is what Il Messaggero anticipates by revealing that it is the large cooperative shareholders of Unipol, eager to do a radical cleaning of the Ligresti group with devaluations on assets: On the rise Ansaldo Sts +3,8%. Among the small caps it rises Landi renzo +3,2% on expectations that the government will launch new incentives for the purchase of ecological cars. Still strong buys on Kinexia, which advanced 4% after the stock rose 23% yesterday.
