Il Blackest Friday in XNUMX years has left its mark. Asian lists open in the red, held back by the surge in US inflation. A minus also for western market futures, pending the next meeting of the Federal Reserve which will undoubtedly announce another rate hike: a 0,75% increase is not excluded, confirming that inflation is not at all below check. The new drop in the euro (1,0479 against the dollar, at its lowest since May 19th) confirms the poor reception of the Frankfurt decisions by the markets. Not a single signal came over the weekend regarding the Central Bank's alleged anti-fragmentation plan in an anti-spread function. Indeed, Melenchon's advance in the first round of French legislation is destined to weaken the front of Mediterranean finance.
Eurostoxx down. In Paris Melenchon in front of the president's men
futures onEurostoxx mark a decline of 1%. The ones on the index do no better S&P, -1,8% in Asian trading. The 3,201-year T-bond trades at 2018%, the highest since November XNUMX.
It does not escape the crisis Tokyo, -2,8% on the eve of the central bank meeting. The yen celebrates, so to speak, with a new decline against the dollar, which has jumped beyond 135, a new high since 1988. For the first time, the Finance Ministry expresses its "concern" about the landslide. The Japanese 0,25-year bond falls to 500%, prompting the Bank of Japan to take measures, with the announcement of purchases on five-year and ten-year maturities for XNUMX billion yen
The worst bag is that of Alone (-3,3%), followed by Hong Kong. Chinese lists are holding up better: -1,3%% for the index CSi 300.
Bitcoin collapses, 39 billion burned in Milan on Friday
Expectations of a weakening of demand penalizes the WTI oil, down 1,5%, to 118,7 dollars a barrel.
Also noteworthy is the sharp drop in cryptocurrencies: Bitcoin down 6% to $25.750, a price not seen since December 2020. Celsius Network tonight froze the option to redeem and transfer Celsius CEL currency, which was down 55%.
Milano reopens its doors after burning 39 billion of capitalization on Friday. Among the macro data, the final number on inflation in May stands out during the week, after the preliminary estimate indicated a rise in prices on an annual basis of 6,9%.
Also noteworthy is the meeting of the Bank of England on Thursday which can only follow the choices of the Fed.
Fed not ruling out 0,75% rate hike
Ben Bernanke, former Fed chairman, claimed that “monetary policy is 98% communication. Decisions do not matter more than 2%”. If this principle holds true, Christine Lagarde deserves a large fail, but, reading the reports arriving from the US, it is not that Jerome Powell is on the way to getting a better vote. Yesterday, President Biden himself declared that the US will have to resign themselves to living "for a while" with rising inflation, an implicit distrust in the action of the Central Bank which was unable to intervene in time.
In this frame it gains weight the hypothesis of an increase of three quarters of a point already on Wednesday evening, a truly gloomy prospect for a market that has retreated by 18% since last January, the likes of which hasn't happened since 1962. Also for this reason it is easier for the bankers of the Fed to limit themselves to half a point, barring anticipating new interventions. Already anticipated by the performance of the bonds.
The T-note (and Microsoft) signal the arrival of the recession
Il Ten-Year Treasury Notes it weakens to 3,20. Expectations of a reshaping of the path of interest rate hikes penalize the two-year Treasury Notes more, whose yield rises by ten basis points to 3,16%. The spread between the two terms closed abruptly, -22 basis points to 3 basis points: the flattening of the curve signals economic stagnation, or recession, on the way.
The accounts predict tidal waves, if not storms Cisco. Negative notes also came from Microsoft, which lowered the level of forthcoming earnings. Also to follow the accounts of New York Times, a rare example of publishing success.
