There are only two weeks left, perhaps the hottest, before the vote for the White House. On the European front, the battle is raging ahead of the Commission's judgment on national budget laws, including the much-contested Italian maneuver. But financial news is breaking into the political scene today. In Italy, the Monte Paschi game, accompanied by a formidable recovery of the stock on the Stock Exchange. "I'm not interested in favoring one ex minister rather than another", commented Matteo Renzi in the face of the challenge between the plan promoted by Vittorio Grilli (ex Treasury, now JP Morgan) and the outsider Corrado Passera (supported by Atlas group) .
The US picture is much more incandescent, after the conclusion of the umpteenth deal of the century, the purchase of Time Warner by AT&T which immediately became a political case. “If I am nominated president, I will block the operation” Donald Trump immediately said, hoisting the banner of populism against the barons of Wall Street. But many concerns were also expressed by Tim Kaine, the Democratic candidate for the Democratic vice presidency. Today the word passes to Wall Street.
These few notes are enough (to which must be added the probable acceleration of fuga from the City of Banks sfear of the hard Brexit as Theresa May wants it) to understand that a financial week of great intensity begins despite no central bank meetings are scheduled.
FLAT BAGS, OIL AND THE EURO DOWN
Navigation, as usual, kicked off with the Bags of the East.
Under pressure in opening the currency market. The euro fell for the fifth day in a row to 1,0864 (-0,2% to its lowest level since February). Even the yen (103,93) falls against the dollar. The drop in the pound was more marked (-0,3% to 1,2197 on the US currency)
The stock markets were not moved: Tokyo +0,3%, Sidney – 0,6%. Chinese stocks up; Shanghai +1,3%. Hong Kong, closed on Friday due to the passage of a typhoon, rose by 0,3%.
Oil prices fell this morning: Brent at 51,19 dollars (-0,4%), Wti at 50,63- Iraq, said the energy minister, does not intend to adhere to the agreement to cut production .
US GDP, RENZI-EU TUMBLING, BANKS LEAVE THE CITY
The most relevant macro data of the week in the USA is the communication of third quarter GDP scheduled for Saturday. A 2,5% increase in GDP is expected, a clear acceleration compared to the 1,4% reached between April and June. Economists predict the drop in consumption, tempered by the trend in automotive sales.
Great tension in London. The GDP data will be communicated during the week. A sharp slowdown to 0,3% is expected, down from 0,7% in June, barely touched by the Brexit outcome. Meanwhile Anthony Browne, president of the British bankers' association, has written an open letter to underline the risks of a failed agreement to guarantee a European passport for the City's banks. “Most international banks already have plans to decide which parts of their operations need to be transferred in order not to lose customers,” writes Browne. “They have already decided on the date this transfer will happen and how best to accomplish it. Their hands are on the move button. Many small banks plan to transfer before Christmas. The biggest banks are preparing to do it in the first quarter of next year”.
In the Eurozone it starts today with i PMI data for the eurozone. Tomorrow the president of the ECB will speak at the European Lecture.
On the Italian front, the spotlights are turned on today on the letter with i remarks of the EU Commission on the financial manoeuvre which is about to go to Parliament. The first expected appointment is the setting of the calendar of hearings in the Finance and Treasury Commissions of Montecitorio. Thursday, on the occasion of the Savings Day, the governor of the Bank of Italy Ignazio Visco and the Minister of Economy Giancarlo Padoan will intervene.
END OF MONTH AUCTIONS FOR THE TREASURY, EIGHTH RECORD FOR MILAN +3,4%
Filed (ingloriously) on tenth BTP Italy the Treasury launches month-end issues. Two index bonds will be issued on Wednesday. Thursday will be the turn of the six-monthly Bots, Friday of the medium-long term bonds. The collection of requirements for 2016 has reached 90%.
Piazza Affari closed a positive week, with theFtseMib index which in five sessions gains 3,4%, thanks above all to the recovery of the banks. Today, on the last day of the week, the index achieved a modest progress of 0,1%, in line with the performance of the other European Stock Exchanges: Paris closed unchanged, Frankfurt +0,1%. The weekly balance of the European Stoxx 600 index is a rise of 1,2%.
MORELLI REVEALS THE PAPERS, PASSERA WAITS FOR THE DUE DILIGENCE
Field day today for Monte Paschi. During the board meeting also called to approve the accounts for the quarter, the CEO Marco Morelli will lift the veil on the industrial plan that should guide the bank towards the third bailout plan in recent years. The operation envisages the injection of 5 billion of assets through a capital increase, the conversion of subordinated bonds and the entry of one or more new strong shareholders (the last among the eligible candidates is George Soros, together with the Kuwaiti funds and the bamca central China). However, Corrado Passera's alternative plan is still at stake, at the origin of the sharp rise in the stock (58% in the last five sessions): the due diligence should start in a few days. Finally, tonight, the plan will be illustrated to the unions.
TODAY THE LUXOTTICA ACCOUNTS. TOMORROW FCA AND SAIPEM
Not only Monte Paschi. Today Piazza Affari looks closely at the turnover figures of Luxottica, -1,7% on Friday after the communication of the accounts of the French Essilor, which disappointed investors with a quarterly performance below expectations and overly cautious indications for the remainder of the year. The link between Essilor and Luxottica is twofold, comments Websim: The French group specializes in the production of lenses and is a supplier and partly a competitor of Leonardo Del Vecchio's group. So, if Essilor's results don't shine, Luxottica's will be dull too. Essilor's Achilles heel risks being the same for Luxottica: the United States. In the first half the Italian group generated 57% of revenues in North America, Essilor, in the first 9 months, 43%.
The quarterly campaign will continue on Tuesday with the board of Fiat Chrysler and Saipem. Then Thursday will be the turn, among others, of the accounts of Eni, Mediobanca, Recordati and Stm .
The European calendar is also very busy. Tomorrow it's Orange's turn, Wednesday at Banco de Santander.
TLC AND MEDIA MARRIAGE AT WLLL STREET EXAMINATION, TRUMP VS
The acquisition of the Time Warner group by AT&T, the US telecommunications giant, was closed in record time on Saturday evening to avoid obstacles to the operation: 85,4 billion dollars (108,7 billion including debt ), equating to a valuation of $107,50 per share ($53,75 in cash and $53,75 in AT&T stock). On Friday, after the first advances, the Time Warner stock (Hbo, Cnn, Warner Brothers) rose by around 8%, that of AT&T fell by 3% (for a capitalization of 226 billion dollars).
There was another billionaire merger over the weekend. Rockwell Collins acquired control of B/E Aerospace for $6,4 billion, partly in cash, partly in equity plus $1,9 billion in debt.
APPLE PRESENTS THE ACCOUNTS. 170 QUARTERLY COMING SOON
In addition to the billion-dollar transactions (not to be underestimated the tobacco merger between Bat and Reynolds, 47 billion dollars, concluded on Friday), the market's attention will be focused on the quarterly reports, 170 in all, which will be announced during the week. The most awaited, as usual, concerns Apple Lossless Audio CODEC (ALAC),: iPhone sales are expected to decline (211 million units) for the financial year. The big names in technology will follow suit, (A) of the automotive (General Motors) of chemistry (Dow Chemical) and energy (Exxon Mobile).
