"It may be appropriate to hike rates again relatively soon if incoming labor market and inflation data is in line with or stronger than expected, or if the risks of overshooting increase." The minutes of the last Fed meeting managed the feat of adding absolutely nothing to what was already known about the central bank's stance. What does "relatively early" mean? The latest statements by Janet Yellen and partners make it clear that the Bank could move as early as March 15th. However, the majority of observers (53%) are convinced that D day will fall in May, when the lines of the tax reforms anticipated by Donald Trump will be clearer. But the constant postponements and the general uncertainty do not hold back the Bull. “Wall Street seems to have forgotten how to go down” notes Giuseppe Sersale of Anthilia noting that for 15 sessions the S&P has not shown a loss of more than 0.25%, another record of this optimistic season. The same does not apply to Milan, again under stress due to bank and debt difficulties.
DOW JONES STILL UP, ASIA WEAK
Asian price lists were weak this morning: Tokyo -0,4%, Hong Kong -0,6%, Sydney -0,4%. Down Nissan (-0,9%) after the news that Carlos Ghosn, while remaining president of the company, will leave the post of CEO to Hirotho Saikawa.
Slow down the run of Wall Street. The S&P 500 index recorded a modest decline -0,11%, as did the Nasdaq (-0,09%). An exception is the Dow Jones (+0,16%) which marks a new record at 20,775,6 points, at the end of the ninth consecutive upward session: it has not happened since January 1987.
The rally was supported by the leap of Du Pont (+3,4%): the EU's green light for the 130 billion dollar merger with Dow Chemical (+4%) is assumed to be imminent.
Energy stocks are down (-1,6%). Brent (this morning recovering above 56 dollars) closed at 55,7 dollars a barrel. In Piazza Affari Eni -1,5% and Saipem -3,4% awaiting the accounts. In the evening, the board of Tenaris was also held, + 0,4%: the conference call on the results will be held in the afternoon.
EUROPEAN LISTS HOSTAGE OF THE FRENCH ELECTIONS
A heavy political burden continues to hang over the markets in the Eurozone. Not surprisingly, the price lists (including Piazza Affari) recorded a significant improvement after the news of the withdrawal of the candidacy for the Elysée by the centrist François Bayrou in favor of Emmanuel Macron, considered the most credible challenger to Marine Le Pen.
Downside session for the Ftse Mib which closed at 18.885, down 0,83%, after having touched a low at 18.788. Similar script for Madrid (-0,99%), together with Piazza Affari the list most sensitive to the performance of the banking sector.
The other European markets are on positive ground. Paris advanced by 0,05%, Frankfurt by 0,21% and London by 0,41%.
BRUSSELS. THE ITALIAN DEBT HAS BEEN BREACHED BY 7 POINTS
Italy, included by the European Commission in the group of six countries with excessive economic imbalances, could run into an infringement procedure for debt escalation if the government does not fulfill its commitment to cut the structural deficit by at least 0,2% of GDP by the end of April. This is the warning contained in the annual report drawn up by Brussels on the economic and social situation of the member countries of the Union.
"Excessive imbalances, slow down reforms" is the harsh judgment of the Commission: Rome's debt has exceeded its target by as much as 7,4 percentage points of GDP. Minister Pier Carlo Padoan commented via Twitter that it is in the national interest to reduce the debt "with a limited adjustment to the consolidation path".
Germany has also come under fire for its excessive trade surplus. "The surplus - said the EU economic affairs commissioner Pierre Moscovici - creates problems for the German economy and produces significant distortions for the entire euro area, therefore it must be rebalanced".
THE SPREAD RISES BEYOND 200 POINTS. 10 BILLION BTP COMING SOON
BTP on a roller coaster, at the mercy of political tensions. The 202-year bond went up to 8 basis points, the highest since last February 193, to then fall back to the XNUMX area on the news of François Bayrou's withdrawal from the race for the Elysée.
Particularly significant was the widening of the spread on the 2-year segment in the last few sessions, which had risen to 106 basis points (from 99 at Tuesday's closing) and then fell back to the 102 basis points area after Bayrou's withdrawal.
The Bund continues its rally, despite a 15-year auction technically going uncovered. The new 5-year Spanish government bond for the amount of XNUMX billion euros was well received.
The warmest front remains the French one. But in the final session, the yield on the 1,031-year Oat dropped to 1,117% after a session high of 76%. The France-Germany spread stood at 84 basis points, after reaching 80 basis points in the session and yesterday's closing at XNUMX.
On Monday 27 February, the Treasury will make available to investors between 8 and 10 billion euros in 5 and 10 BTPs, plus various Ccteu.
BRUSSELS AND FRANKFURT ARGUMENT ABOUT MPS
The increase in the spread and Brussels' judgment on Italian accounts weighed on bank stocks. The sector index closed with a drop of 1,84% (against -0,2% in Europe) after having reached a minimum of more than 3%.
The Financial Times today dedicates a long article to the disagreements between the ECB and the European Commission on the recovery plan for Monte Paschi regarding the amount of public intervention and the costs that creditors will have to bear.
The ECB wants to get the green light from Brussels to inject 8,8 billion into the bank. But the EU first intends to receive clarifications on the division of costs: under German pressure, the EU tends to limit the contribution of state capital, therefore it requests a detailed plan from the Single supervisory mechanism to prevent the operation from relying too much on state aid.
The heaviest losses concern Banco Bpm (-4,2%) and Bper (-3,8%). Mediobanca also down (-3,3%). Unicredit also fell sharply (-2%) on the eve of the closing of the capital increase. Understanding -1%.
Out of the main deep red list for Creval (-5,4%) and Carige (-2,3%), the latter grappling with the update of the plan and the reduction of non-performing loans.
THE MEDIOLANUM LANDSLIDE CONTINUES
Banca Mediolanum's landslide continued (-3,19%), after the very cautious guidance provided on interest margin, performance fees and dividends. The company's investor relator clarified that, at the moment, he has not yet identified the criteria for the new performance fee calculation method that will be applied from next year, but the most probable scenario sees a decrease in these fees of 35 basis points which could be offset by a 20 basis point increase in recurring fees.
The decline of the Doris family bank also involved Azimut (-2,94%) and Banca Generali (-1,9%). In Europe insurance companies are up with Axa (+1,7%). In Milan Generali reports a drop of 0,7%, UnipolSai -0,5%.
IN FLIGHT STM, FINCANTIERI AND DIASORIN
The positive notes come from the industrial sector. Stm (+2,84% at 14,14 euros) confirms the gains that have brought it close to the 2007 valuations. Barclays which has raised the recommendation on the stock from equal weight to overweight, with a target price of 16,5 euros . Equita Sim improved the target price on Stm from 14 to 15,2 euros (buy).
Fincantieri posts an increase of 4,57% after signing a binding Memorandum of Agreement with China State Shipbuilding and Carnival for the construction of two cruise ships, plus an additional four in option, which will be the first units of this kind ever built in China for domestic market.
Diasorin (+3%) benefits from FDA authorization for the distribution of a test in the US. Weak Leonardo (-0,5%) and Fiat Chrysler (-0,2%). Cnh Industrial (+0,79%).
JUVENTUS ON THE SCUDI ALSO IN THE BUSINESS PLACE
Juventus protagonist not only on the soccer fieldbut also on the stock exchange. In the last three days there have been anomalous trends in the share, which is listed on the Piazza Affari. Notably, shares rose 5,12% and 2,45% respectively on Monday and Tuesday. But what matters even more is the quantity of securities traded: over 8,5 and 5 million pieces, for an economic consideration of 4,5 million euros.
In the third session of the week, trading slowed down, but still exceeded 3 million (while the shares fell by 0,8%), far beyond the average trading on Juventus shares, which never exceeds one million pieces. The English fund Lindsell Train has held a stake of around 10% in the capital of Juventus since last summer.
Fiera Milano marks a rise of 2,45% to 1,42 after signing a contract for the sale of the 75% stake it held in the Chinese Worldex Fiera Milano Exhibitions based in Guangzhou. The stake was taken over by SingEx Exhibitions, a leading operator in the Singapore trade fair sector.
