The markets slow down on the eve of the first exams. With Alcoa's accounts (significantly down yesterday) the US quarterly campaign is about to kick off, a demanding test after the strong rally that has distinguished Wall Street since the election of Donald Trump. Meanwhile, the relay to the leaders of Washington is approaching. The parliamentary hearings of the team chosen by the new president begin today and sparks will fly for the occasion.
The producers' agreement on oil also comes under scrutiny: Iraq, like Iran, continues to pump at record levels.
Piazza Affari is also slowing down, waiting for signals on the banking and public finance front. On Friday, the Dbrs rating agency, the only one to give the Bel Paese an "A", could downgrade the Italian debt. According to HSBC analysts, such a move would not have immediate consequences on the BTPs, protected by Mario Draghi's shield, but could increase funding costs for the most fragile Italian banks. In that case, the 20 billion allocated for the recovery of the sector may not be enough.
BRAKE TOKYO. IN CHINA THE STATE BUYS MC DONALD'S
Meteo Borsa expects an uncertain start, in line with the closure of the US price lists. Tokyo is down 0,8% in the final session. Yesterday it was closed for holidays. Hong Kong's Hang Seng index gains 0,5%, while the Shanghai stock index is slightly down.
Few surprises from tonight's Chinese inflation data. Consumer prices rose by 2,1% yoy, from +2,3% in November. The stock exchanges of India and South Korea are up slightly.
Great maneuvers on the consumption front. McDonald's has sold the fast food chain in China for 2.08 billion dollars to the state conglomerate Ciric and the Carlyle fund. Meanwhile, Alibaba has announced its intention to privatize Intime (+38%), acquired a year ago.
NASDAQ RECORDS, IRAQ HOLDS OIL
Contrasted performance on Wall Street: the Dow Jones (-0,3%) and the S&P (-0,5%) retreat under the pressure of crude oil; new record for the Nasdaq (+0,2%), at 5,531,99 thanks to the boost from the health sector.
The sharp drop in oil prices conditioned the session: -4% from the record levels reached last week. Brent closed below 55 dollars, Wti below 52. The plunge is linked to the increase in US shale oil activity and to the news of the new export record from the Iraqi Basra terminal. Finally, Bloomberg reports that the market expects an increase in inventories of crude oil and distillates in the United States: the data will be published tomorrow afternoon.
On Wall Street, the energy sector fell by 1,4%: Exxon -1,7%, Chevron -1,2% and Halliburton -1,3%. European oil prices are also down (Stoxx in the sector -1,3%). Eni closed down by 2,1%, Saipem -3,1%, Tenaris -0,7%. Weak financials (-0,6%) pending the start of the quarterly campaign: Thomson Reuters expects an average increase in profits of 5,8%.
FCA ABOVE 10 EUROS, MARCHIONNE CONFIRMS TARGETS
Also yesterday Fiat Chrysler was at the center of attention. The share recorded an increase of 1,41%, taking it beyond the 10 euro barrier after the declarations of Sergio Marchionne who, speaking in Detroit, did not rule out the possibility of a "big deal" with another producer ( probably Gm) before his term ends in 2018.
Many topics were discussed by Marchionne, yesterday praised by Donald Trump for the decision to repatriate production today in Mexico to the US plants ("a choice that was already in our plans", the manager wanted to clarify). However, the CEO said he believes that the new customs barriers, which could come from the administration of the new US president, Donald Trump, would be an obstacle to development, adding however that he will adapt to the new rules.
Marchionne, speaking of FCA, confirmed all the targets for 2018, including the return to the dividend ("perhaps sooner"). When asked about whether he will remain at the top of the group until 2020, Marchionne said he "hopes" to sign the last balance sheet for 2018 and did not rule out that FCA could make a big deal by that date. To hit that goal, he added, “I have eight quarters left.”
MILAN HOLDS DOWN AFTER SIX INCREASES, 7,25 BILLION BTP INCOMING
After six consecutive days of bullishness, Piazza Affari and the other European stock exchanges experienced a day of bearishness. The benchmark future for the London stock market is down 0,1%. In Milan, the FtseMib index lost 1,6% to 19.360 points, under pressure from sales on banks.
The decline of the other markets was less significant. The Paris Stock Exchange loses 0,5%, Frankfurt -0,3%. The European benchmark Stoxx 600 falls by 0,44%. The only market bucking the trend was London, which reacted to the weakening of the pound following statements by May, according to which the priority of Brexit would be to stop illegal immigration and not to remain in the common market. “For an exporting sector that earns a little – comments Giuseppe Sersale of Anthilia – an entire population of consumers sees their income depreciate”.
The Btp/Bund spread closed the session at 161,751 basis points, down on the 165,316 at last Friday's closing.
The Treasury announced that on Thursday the 12th it will offer between 5,75 and 7,25 billion BTPs at 3, 7 and 20 years. These will be the first medium-long auctions to be held in 2017. The calendar is very busy. Today Austria and Holland are going to auction. On Wednesday, however, Germany is activated on the primary with the offer of 5 billion of the new 10-year Bund in February 2027. In addition to Italy, Thursday there will be the offer of US thirty-year bonds.
UBI ONE STEP FROM THE GOOD BANKS. THUD OF POST
A difficult day yesterday for the banking sector, after last week's increases. The Ftse Italian Banks index lost 4%, the Eurostoxx Banks 2%. Ubi (-4,25%) is one step away from the acquisition of Nuova Banca Marche, Nuova Banca Etruria and Nuova CariChieti. Yesterday the deadlines for submitting expressions of interest in the new tender wanted by the EU Commission expired. On Thursday, Ubi's management and supervisory boards will give the definitive ok to the binding offer. The Lombard bank has asked for a further 2,2 billion euro cleanup.
Unicredit (-5,11%) turned down to 2,67 euros, after reaching 2,8380 euros in the morning. The performance since the beginning of 2017 returns negative by 2%. Yesterday Jefferies strengthened the Buy rating bringing the target price to 3,50 euros from 3,0 euros. The capital increase could start on February 13 and be completed by the end of March.
Banco Bpm also lost ground (-4,5%). The Bank has communicated to Consob the list of significant shareholdings. The stake held in Gabetti Property Solutions (-2,26%) is now equal to 9,113%; that in the share capital of Anima Holding (-0,83%) to 14,672%, and that in Risanamento (-5,57%) to 10,069%.
Veneto Banca and Popolare Vicenza have launched the repayment plan for shareholders who have invested in the two banks in the last ten years suffering heavy losses, putting over 600 million on the plate. Pop Vicenza's settlement proposal offers recognition of 9 euros per share, while Veneto Banca shareholders are offered a "flat-rate and all-inclusive" indemnity equal to 15% of the theoretical loss against the renunciation of promoting any legal action. The offer is aimed at around 169.000 members overall (94.000 of Pop Vicenza and 75.000 of Veneto Banca).
Under fire Poste Italiane (-2,14%) in the face of the prospect of repayments on some real estate funds placed over the counter. The company has already set aside 50 million euros.
STM SUPERSTAR, CUCINELLI'S ACCOUNTS OK
Stm was the best stock in the main index, with an increase of 3,04%. Deutsche Bank and UBS improved their target price on the stock. The entire technology sector at European level was positive, with the sector index up by 0,79%.
Weak Mediaset (-1,44%). The company will unveil the standalone plan on January 18. Equita expects the enhancement of Ei Towers, Mediaset Espana, and Premium for the occasion. Vivendi's takeover of Mediaset will be addressed by the Communications Authority in a meeting scheduled for this week.
The Lactalis group has filed the offer document relating to the voluntary takeover bid on Parmalat with Consob. Brunello Cucinelli closed 2016 with revenues growing, at current exchange rates, by 10,1% to 456 million, in line with analysts' expectations. At constant exchange rates, the increase is 10,4%.
