Donald Trump could postpone the entry into force of tariffs for Mexico, already set for Monday. The Mexican government, reports Bloomberg, has in fact decided to send 6 men to the southern borders to stop the flow of migrants from Honduras and Guatemala. The US will also have more freedom to intervene at the border. "It's not enough, let's move on," commented the president. But the news, on a day devoid of Chinese price lists closed for holidays, is sufficient to guarantee the rise in price lists this morning pending the last key appointment of the week: the data on new jobs in the USA, a crucial statistic for understanding whether the Fed will lower rates at its next meeting or it will choose the waiting line as the ECB did: Mario Draghi, close to expiry, failed to get the go-ahead for the stimulus plan hoped for by the markets.
CHINA STOPS, JAPAN GOES UP
Japanese stock markets rose this morning: +0,4% for the Korean Kospi and India, driven by the drop in interest rates. The yen moved little at 108,5 against the dollar. Tokyo does not intend to cap currency swings as Washington has requested.
In the meantime, the governor of the Chinese central bank YI Gang has warned that, if the war on trade worsens, Beijing will take "the most appropriate countermeasures. The spaces for maneuver are immense,” he added. However, the contacts between the Big are intensified to ensure that the meeting between Trump and Xi Jinping at the end of the month does not register a new failure.
OIL ON THE RISE. RIYADH DOES NOT CONVINCE PUTIN
Oil up this morning for the second day: Brent at 62,5 dollars a barrel (+1,3%), WTI at 53,3 dollars (+1,4%). The Saudi diplomatic trip to St. Petersburg does not seem to have moved the Russian government, which intends not to extend the agreement to curb production for another six months.
Oil companies at stake in Piazza Affari: Eni +0,2%, Saipem +0,3%.
FED READY TO MOVE AFTER EMPLOYMENT DATA
The decrease in tension with Mexico favored the rise in US stock markets: Dow Jones +0,71%, S&P 500 +0,61%. NASDAQ +0,53%. For the first time in a month, the three main lists close together on the rise.
Markets are tuning into US employment data today: the consensus expects +175.000 new jobs for May, up from 263.000 in April, with a modest acceleration in hourly wages.
DRAGHI DOES NOT FIRE ITS AMMO
Satisfied? Not exactly. Indeed, a little disappointed, judging by the performance of the price lists in the finale. So the markets have reacted to Mario Draghi's words at the press conference: "Despite the better-than-expected data for the first quarter - said the banker - the latest information indicates that the global headwinds continue to blow on the prospects of the Eurozone". In other words, interest rates must remain low but there is no need to fire all the ammunition now because, as Giuseppe Sersale of Anthilia commented, "the tools available to the ECB to make monetary policy further expansive are not so abundant, and the bazooka it must therefore be preserved for really serious situations”.
SO MUCH LESS GENEROUS THAN IN THE PAST
In summary, the ECB will leave interest rates unchanged at their current record lows until at least mid-2020 and in any case for as long as necessary. The institute communicated it in a note. In particular, the main rate will remain at 0%, that on deposits at -0,40% and those on marginal refinancing at 0,25%.
The cost of the refinancing operation, the so-called LTTRO, will be less convenient for the banking system than LTTRO II, but could improve in the future: from the previous rate of -0,40% it will move to a range of -0,30%/ +0,10%.
FLAT BUSINESS PLACE, FRANKFURT SLIDES
Piazza Affari, which gained one point before the press conference, closed the session just above parity: +0,11%, at 20.177 points.
Frankfurt fell back by 0,2%. German industrial orders rose 0,3% in April, beating expectations. Paris -0,26%, Madrid rises (+0,24%).
The price lists outside the Eurozone are better: Zurich +0,88%, London +0,7%, even if Great Britain continues to foot the Brexit bill. Ford will close its plant in Bridgend, Wales in September 2020 with the loss of 1.700 jobs.
NEW LOW FOR BUNDS, SPREAD AT 275
The ECB's willingness to keep the cost of money low (if necessary, Draghi underlines, it could drop further) favors purchases of German Bunds: the 0,23-year bond has slipped to -XNUMX%, a new historic low.
The spread widens by 5 basis points to 275, for a ten-year BTP yield of 2,51%. Draghi, who rejected the mini Bots without appeal, did not offer any support to the yellow-green government: “The European Commission has concluded that Italy must reduce the debt/GDP ratio and Italy will have to produce a credible medium-term reduction program . I don't think a rapid decline will be asked."
The euro traded this morning at 1,126 against the dollar.
SALES ON BANKS, UTILITIES ON SHIELDS
On the stock market, sales were concentrated on the banking sector which was slowing down after a lively start. The Bigs are losing blows: Unicredit -1,6%, Intesa Sanpaolo -1,1%, such as the former Popolari Ubi Banca (-1,5%) and Banco Bpm (-1,8%). Popolare di Sondrio dropped 3,5% after Fitch announced the cut of its long-term rating.
Nexi +2,3%, new record since listing. From Monday 24 June it enters the Ftse Mib index, Banca Generali leaves -2%. In managed Azimut drops by 3%. Ubs has cut the rating to Sell.
Unlike credit, the confirmation of low rates brought new money to utilities: Enel +1,4%, A2A +1,5%, Italgas +0,5%.
RULES FCA, FERRARI TO THE MAXIMUM
The Agnelli team withstood the blow of the failed FCA-Renault agreement. FCA (+0,09%) closed close to parity after recovering about four points of losses. Things went much worse for Renault (-6,4%). Exor stable (-0,3%). Ferrari (+1,5%) set a new historic record; Cnh -0,2%. Basically, only Juventus retreats, -2,27% after the leap on the eve.
Also noteworthy are the performances of Autogrill (+4,6%) and Leonardo (+3%). And by Salvatore Ferragamo (+1,86%) promoted by HSBC from veteran to hold, and with a target price that has risen from 16 to 19 euros.
Kepler Chevreux instead punished Falck Renewables (-11,25%) from old to veteran. Instead, Terni Energia was promoted (+2,43%) after the sale of 22 photovoltaic plants.
