The soft landing of the Chinese economy is proceeding without incident. The Asian stock exchanges can thus archive the best week of the last three months without tearing. In fact, the Chinese GDP rose by 6,7% in the first quarter (-0,1% compared to the previous three months), in line with forecasts. It is the lowest figure since 2009, but there are clear signs of recovery in the real estate sector (+6,2% construction site activity, even +33% sales) and new investments (+10,7%). thanks to which the economy has been able to cope with the consequences of lower global growth.
Services also rose (+7,6% against +5,8% for industry) despite the figure being compared with the stock market boom a year ago, which culminated in the bubble in August. Consumption was also better than expected, confirming that the worst is over. The Asian stock exchanges took note of it without particular emotions: Shanghai lost 0,26% in the middle of the session, Shenzhen - 0,38%. Hong Kong -0,16%. Profits were taken in Tokyo (-0,7%), but the Nikkei index is about to end the week with a 6% increase.
MARKETS STILL AWAITING THE OIL SUMMIT
The US markets are flat. S&P500, Nasdaq and Dow Jones closed unchanged. New signs of strength are coming from the labor front: claims for unemployment benefits have fallen to their lowest since 1973. Meanwhile, the demands of workers are growing: Verizon employees are crossing their arms, the request to raise the rate to 15 dollars an hour rises minimum pay. Inflation is lagging behind (+0,1%) further distancing a possible rate hike.
Financials still supported the market: Bank of America +2,5% after balance sheet data in line with expectations, Wells Fargo -0,5%.
Oil is settling after the recent strong gains: Brent trades at around 44 dollars a barrel, Wti at 41,9 dollars (+ both + 0,4%) pending the summit between producers in Doha over the weekend.
Stocks linked to energy were positive: in Piazza Affari Eni rose by 1,7%, Tenaris -0,1%, Saipem +3% galvanized by the assignment of works for the offshore part of the Tap gas pipeline.
MILAN +0,9%, NESTLE' BEST BLUE CHIP IN EUROPE
Thanks to the acceleration in the final favored by the US macro data, the European stock markets yesterday closed another session on the rise. The Paris Stock Exchange rose by 0,4%, Frankfurt +0,6%. London +0,03%. No surprises from the Bank of England, which left the Qe unchanged and the Bank rate stable at 0,5%.
The best Stoxx index is that of the Food sector, thanks to the 2% rise of Nestlè, which announced better-than-expected first-quarter revenues. Spotlights turned on today on the accounts of Carrefour, the litmus test of the trend in consumption in Europe.
In Milan, the FtseMib index gained 0,9%, driven by the recovery of the banks. Government bond yields rise: the 10-year BTP is trading at 1,34%, from 1,29% yesterday, the Bund at 1,16% (from 1,12%)
GHIZZONI: "IF NECESSARY, ATLANTE WILL GIVE US A HAND IN VICENZA"
Piazza Affari ends the session with all banks up (+1,25% the sector index). In the meantime, consensus is raining down on the Atlante fund, promoted with flying colors by Christine Lagarde, director general of the IMF. "We are completing the authorization process with all the competent authorities for the establishment and launch of the Atlante fund", writes the president of Quaestio sgr, Alessandro Penati, in a note: "We are receiving increasing subscriptions to the fund and we hope to be able to reach the collection targets in a short time”.
The Atlante fund, it was specified yesterday, will also be able to temporarily acquire control of those banks that need fresh capital. "In this sense, he will give us a hand", said the CEO of Unicredit, Federico Ghizzoni at the meeting: "The institute - he added - will continue to do everything possible to successfully complete the capital increase from 1,75 billions of Banca Popolare di Vicenza". But if the operation ends with an unsubscribed share, "the Atlante fund will take over for the unsubscribed portion".
After these statements, Unicredit accelerated going to close up by 3,1% (+21% in the last five sessions). Understanding +0,5%. Monte Paschi also climbs (+0,8%). In the meeting, CEO Fabrizio Viola said that the Bank is ready to accelerate the sale and recovery of non-performing loans also using the parachute of the Atlante fund, which will guarantee capital increases and purchase non-performing loans. The best blue chip of the day is Bper (+4,5%): the rise is 37% from the lows of April. The institute gained control of the Cassa di Risparmio di Saluzzo (35,3 million).
POPULAR TO THE RESCUE. LETIZIA MORATTI NEW PRESIDENT OF UBI
The recovery of Banco Popolare also continues (+3,9%), extending the streak started five days ago which has so far generated an overall recovery of 37%. Moody's has placed the security under observation for a possible upgrade of the long-term rating on deposits 'Ba2' and the long-term rating on senior debt “Ba3”. The short-term ratings were confirmed at “Not-Prime”. Bpm +3,1%. The CEO Giuseppe Castagna: "The establishment of the Atlante fund seems to us to be a correct operation for the system and we would like to participate". Strong earnings for Pop too. Milan (+3,1%).
The supervisory board of Ubi Banca (+2,06%) has appointed Letizia Moratti new chairman of the management board. Confirmed Victor Massiah as managing director.
STM UNDER FIRE: BOZOTTI'S RELEASE WITHIN THE YEAR
Among the industrial stocks, the drop in StM stands out (-2,2%), conditioned by the profit warning of the Chinese Taiwan Semiconductor Manufacturing, which announced revenues for the quarter lower than forecasts. Weak on Wall Street Intel (-1,4%) and Texas Instruments (-1,3%).
According to Reuters, the Board of Directors of the Italian-French group has decided to replace the CEO Carlo Bozotti within the year. The Board has already drawn up a short list of possible successors. Among these could be the former CEO of Telecom Italia Marco Patuano.
Kepler Cheuvreux analysts maintain a positive attitude on Prysmian (-0,34%, buy rating and target price at 22 euros). Speaking on the sidelines of the meeting, Valerio Battista did not rule out possible mergers and acquisitions also with regard to the Tlc cable division. In this regard, the broker underlines the positive prospects of the division, due in particular to the renewed attention towards broadband in Italy, confirmed by the investment plans announced by Enel and Telecom Italia.
BOUNCES TELECOM, CLOSER TO METROWEB
Telecom Italia +1,5%: Morgan Stanley reiterated its positive opinion on the stock (overweight, Tp at 1,25 from 1,37 euro) in a report entitled "the history of the value of fundamentals is emerging".
Meanwhile, the purchase of 53% of Metroweb controlled by the F2i Fund seems closer. The valuation of the company is around 1 billion euros, equal to 15 times the EBITDA. Enel, the other candidate to deal with the broadband network, rose by 0,4%.
Brilliant Buzzi (+2,8%).
ELKANN: WELL A MERGER FOR FCA. BUT THE TANGO IS DANCED IN TWO
Fiat-Chrysler +1%. In March, car sales in the 17 Western European countries (over 90% of the market) grew by 5,1%. The FCA group did much better than the average with sales up 12,8%. Exane BNP Paribas confirmed the Neutral recommendation, lowering the target price to 6,20 euros from 6,40 euros. Cnh Industrial -0,1%.
In the letter to Exor's shareholders (-0,6%), John Philip Elkann writes that “with the consolidation between car manufacturers, savings close to 10 billion dollars a year could be achieved. Some of our competitors are convinced that it makes no sense to commit to persisting with the past (i.e. consolidation), but that we must instead embrace disruptive change with new technologies and business models that affect the mobility sector".
Elkann (like Sergio Marchionne) does not share this approach: "This wave of hope reminds me of my first years as a Fiat advisor, when in 1999 Jacques Nasser spoke of transforming Ford from an old and boring car manufacturer, whose shares reach a price/earnings of only 10, in a consumer products and services company that deserves a multiple closer to 30. We too at Fiat were convinced that extending the value chain was the way to go and ended up making poor decision making capital allocation".
Therefore, the merger with a large competitor is better. “But it takes two to tango, and most of our competitors are busy with the vast opportunities disruptive technology has to offer.”
RCS, EVEN BPM WITH CAIRO. BUT MEDIOBANCA STAYS HARD
Mondadori +0,46% announced the closing of the acquisition of Rcs Libri for a consideration of 127,1 million euro.
Meanwhile, on the Cairo Communications offer on Rcs Mediagroup (+0,88%), the first openings of the creditor banks arrive which, according to Cairo's request, should waive any repayment until the approval of the 2017 financial statements with the the exception of the proceeds from the sale of Rcs Libri. According to a source quoted by Reuters "Banca IMI (subsidiary of Intesa Sanpaolo and adviser in Cairo) is reassuring the banks that the entrepreneur does not intend to ask for any restructuring or write off of the debt and that he only needs a stand still to fully understand the RCS situation".
The position of Intesa in favor of the Ops was expressed on Tuesday by CEO Carlo Messina and yesterday by the president of the CDS Giovanni Bazoli, even if both said they were ready to evaluate possible alternative proposals. This morning the CEO of Bpm Giuseppe Castagna said he was willing to evaluate Cairo's proposal "with pleasure" if it proves to be a credible industrial solution for the relaunch of RCS.
The creditor banks are Intesa Sanpaolo, UBI Banca, UniCredit, BNP Paribas, Pop Milano and Mediobanca (which considers the offer "inadequate"). The pool must express itself unanimously.
BURBERRY FLOP, LUXURY RETREAT. TOD'S IS AN EXCEPTION
Luxury stocks suffered on disappointing results from British Burberry, down 3,6% after announcing that it will post a decline in revenues in the first half. Barclays in a report on the European luxury sector highlights that Global Blue data on global tourism spending marked a 14% drop in March, after +4% in February.
Ferragamo drops by 1,8%, Moncler -0,3%, Yoox -0,6%. Luxottica -1,7%: Kepler-Cheuvreux has reduced the target to 51 euros from 52 euros, confirming the Hold recommendation. The exception is Tod's, up 3,2% following the promotion of Société Générale.
