The great fear, little by little, is returning. But it will take time to ease the volatility that once again dominated Wall Street yesterday, in the midst of violent changes going from moments of strong gains to deep red with swings of 500 points in both directions. A tension to which the balance, apparently flat, at the end of the session does not do justice. The Dow Jones closed with a minimal change, -0,08% (-19 points). The S&P 500, -0,5%, and the Nasdaq -0,9% were weaker. In short, the panic effect seems to have been averted but operators remain on the alert: more to seize any opportunities on sale than for fear of a collapse.
Meanwhile, signs of easing are coming from the Fed. William Dudley of New York underlined that the round of recent days has not affected an economic situation that remains positive. In Congress, meanwhile, an agreement was reached between the parties on the federal budget for the next two years, eliminating a factor of uncertainty. The markets thus return to concentrate on the issue of the next rate hikes. The selling on the Treasury Bill thus resumes, which rose to 2,82%, from 2,74% yesterday.
A SOCIALIST TO GERMAN FINANCES: MORE INVESTMENT
The dollar is recovering overall against the main currencies, including the euro, traded at 1,226 also due to the other big news yesterday: the birth in Berlin of GroKo, the Grosse Koalition which promises to have a profound effect on Europe's choices. The former burgomaster of Hamburg, the Social Democrat Olav Scholz, will lead the finances of Berlin. . But also determined to mark a profound discontinuity with the austerity policy of Walofgang Schaeuble. A phase of strong acceleration of investments is looming, especially in infrastructures in full harmony with Emmanuel Macron. We hope that the political uncertainties of the Bel Paese do not compromise the opportunities that are emerging for Italy in the new normal.
CHINA FIGHTED: TRADE BALANCE HOLDS BACK
After so many shocks, the Tokyo Stock Exchange is also recovering. The Nikkei index moves to the highs of the session, with a gain of 1,3%, from -0,2% at the start of trading. The yen recovered to 109,6 against the dollar.
Contrasted with Chinese price lists. Hong Kong stocks rose 0,7%, from -0,2% overnight. Conversely, the CSI300 index of the Shanghai and Shenzhen stock markets, positive at the start of the session, lost 1,1%. China's trade balance data was released tonight. Imports jumped by 37% in January, from +4,4% the month before: +10,6% expected. Exports grew by 11%: +10,7% expected. Surplus more than halved on December: 20,34 billion dollars, from 54,69 billion and against the 54,1 billion hypothesized by analysts. However, the customs data partly reflect the different calendar of the Chinese New Year in 2017 and 2018. The yuan weakens against the dollar, in the aftermath of the rise that had brought it to the highest since August 2015: cross at 6,32.
SNAP UP 48%. OK THE TESLA ACCOUNTS
Of note on Wall Street was the stellar (and bizarre) performance of Snap, up 47,9% in the wake of the sharp increase in users. At the center of attention Tesla, +3% in the aftermarket in the wake of the release of data for the quarter. The October-December period closed with losses of $3,04 per share, better than the $3,20 expected by the market. Revenues stood at $3,29 billion, up from $3,28 billion. But more than the results, the impetus came from the umpteenth success of Elon Musk: the launch of his rocket, the most powerful ever, succeeded perfectly.
OIL DOWN, BUT ANADARKO IS SUPER
Oil dropped sharply after data on the increase in inventories and on US crude oil production, which exceeded the threshold of 10 million barrels per day. WTI crude oil delivered in March fell by 1,6 dollars to 61,79 a barrel. However, on the Wall Street stock exchange the stock of Anadarko Petroleum, a US giant in the sector, shortly after closing gained 4% following the announcement of the increase in the dividend to 0,25 dollars per share (5 times higher) and the 'increase in the buyback program. In Piazza Affari, oil prices rise, despite the slowdown in crude oil. Eni +1,6%, Saipem +2,7%, Tenaris +1,5%.
LONGEST BUSINESS PLACE: +5% IN 2018
After three days of passion, the hour of redemption has come for the price lists of the Old Continent. In addition to the push from Wall Street, the agreement between the Cdu-Csu and social democracy in Germany has contributed to favoring the recovery. Olaf Scholz, the socialist mayor of Hamburg, arrives at Finance, farewell to the austerity of Wolfgang Schaeuble.
The Milan Stock Exchange accelerated in the finale. The FtseMib index +2,9% to 22.995 points lengthens significantly from Tuesday's lows to 21.982 points thanks to the unanimous support of almost all the blue chips. The index of our blue chips is confirmed as the best list in the Eurozone since the beginning of 2018 with a gain of 5% (the only positive balance), against -1,5% of the Eurostoxx index.
The Frankfurt Stock Exchange also rose by 2%. In Berlin, the negotiations for the formation of the government concluded positively. The socialists will have the Ministry of Finance, Foreign Affairs and Labour. According to the German chancellor Angela Merkel, who in order to reach the agreement has bent "to painful compromises" the agreement will guarantee a stable government that will be able to concentrate on investments".
London recovers 1,9%. The Bank of England's monetary committee meeting is held today: rates are expected to remain unchanged.
THE SPREAD IS REDUCED TO 119 POINTS. BTP AT 1,92%
The European Commission has published the bulletin with the forecasts for 2018 and 2019. In the current year, economic growth should be 2,4%, up from the +2,1% estimated in November. Estimates for 2019 were also slightly raised, to +2,0% from +1,9%. “It is the strongest and most sustainable recovery in ten years now” claimed the Commissioner for Economic Affairs Pierre Moscovici. Italy should grow by 1,5% in 2018, +1,2% next year.
Meanwhile, the surprising (but pleasant) strength of the bond market in the so-called "periphery" continues.
In the wake of the news of the allocation of the Ministry of Finance to the SPD, the Italy-Germany spread narrowed to 119 basis points, the lowest since 13 September 2016. The 1,92-year bond yields 1,97% (from XNUMX%) .
The Spain-Germany spread reached 70 basis points, down from 79 basis points the day before.
Germany and Greece took action on the primary, awaiting the launch of the 7-year Greek bond. Germany placed 2,492 billion of the 0,69-year Bund, with an average rate rising to XNUMX%.
Athens instead assigned 1,138 billion euros in Treasury securities with a three-month maturity, keeping the yield at the same level as the January auction.
With the markets closed, the Treasury announced the quantities of 12-month Treasury bills to be auctioned next Monday, equal to 6,5 billion against 6,548 billion maturing, while the announcement relating to the securities that will be offered at the auctions is expected tomorrow medium-long term on Tuesday 13 February.
LIKE THE TELECOM PLAN. AND MEDIASET FLIES
In Milan, it is above all the bankers who are pushing the price list, but individual substantial bullish ideas also come from Telecom Italia and Fiat Chrysler.
Telecom Italia ended the day up 6% at 0,7212 euros. CEO Amos Genish presented to the government the corporate unbundling project of the network which was "really liked" by the Minister of Economic Development Carlo Calenda. "This is an epochal turning point - added the minister - after 20 years of talk of the need to achieve separation and equal management for all network access operators". The plan will be brought to the board of directors on March 6th. On Tuesday, positive indications came from Tim Brazil who closed the fourth quarter of 2017 with profits up 66% to 604 million reals (185 million dollars).
Mediaset also stood out with a leap of 3,9% to 3,15 euros which interrupts a streak of seven consecutive declines. Yesterday it was the best title in the European media sector, which was also clearly visible with a rise of 1,4%.
A BOOST FROM KOREA FOR FIAT CHRYSLER
Fiat Chrysler recovers all the lost ground +6,77% to 18,86 euros. Mediobanca Securities raised the target price of the stock from 20 to 22 euros, confirming the outperform recommendation. According to analysts, the Magneti Marelli spin-off will be driving the stock towards new increases, an operation scheduled for June. But Suzuki's CEO, Toshihiro Suzuki, took care of the rebound yesterday. "We - he said speaking of possible alliances - keep an open door to everyone: not only to Toyota, but also to Fiat Chrysler Automobiles". The opening to FCA by the son-in-law of the elderly president Osamu Suzuki could concern new technological projects, also taking into account the Japanese company's know-how in hybrid engines.
Exor is also making a strong recovery: +5,5%.
THE FLIGHT OF INTESA CONTINUES. TODAY IT'S THE TURN OF UNICREDIT
The banking sector rose: the sector index closed up by more than 3% (+2,2% for the European basket).
The ECB addendum on new non-performing loans could come into force on April 11th but there is still no decision on the measures concerning the stock. The head of banking supervision of the ECB Daniele Nouy said yesterday.
The driving effect of Intesa San Paolo continues to be felt (+4% to 3,22 euros, +4,3% savings) which consolidated the gains recorded after the presentation of the plan. Most brokers have promoted accounts and strategy plan. JP Morgan raises its rating to Overweight from Neutral, target price €3,70. Morgan Stanley (overweight) and Deutsche Bank (buy) bring the target to 3,80. Credit Suisse (outperform) raises the target to 3,60 euros from 3,40 euros.
Today the parade of accounts continues with Unicredit +2,76%. The group has announced that it has fallen below 20% of the Fino portfolio, which collects several packages of non-performing loans. As for results, the consensus of analysts estimates that the bank will close 2017 with a net profit of 5,2 billion euros, taking into account the capital gain linked to the sale of Pioneer of 2,1 billion.
BANCO BPM CUTS ANOTHER 5 BILLION BAD LOANS
The best stock of the day was Banco Bpm, +5,1% awaiting the results released in the evening. The institute closes the first annual financial statements of the group born from the merger between Banco Popolare and Bpm, with a net profit of 557,8 million, and adds new NPL sales for around 5 billion, exceeding the targets set by the plan. With the new, more aggressive derisking plan, the total transfers of non-performing loans rise to around 13 billion.
FinecoBank recovers (+2,58%). Equita Sim raised the target price on the stock from 8,3 to 9,7 euro, confirming the hold recommendation. Carige went against the trend, losing 2,4%.
HIGHLIGHTS ATLANTIA AND SIAS
The rebound involved practically the entire basket of blue chips with the exception of Campari (-0,48%). In luxury, the leap of Moncler stands out (+5%). Among the utilities, Terna +2,5%, Enel +2%, Snam +1%. Atlantia +3,4%: according to rumors, next week it could announce the improvement of the offer on Abertis.
Widespread rebounds even among the minor titles. Tecnoinvestimenti (+7%) pushes on the historic record. Ima (+6.9%) and Falck Renewables (+6%) also rose sharply.
Propeller +5,49%, at 2,4 euros. Banca Akros has raised its recommendation from neutral to buy, with a target price of 2,7 euros. Sias (+4,3%) was awarded the tender for the thirty-year management of three sections of motorway in the state of Minas Gerais, in Brazil.
