The Milan Stock Exchange worsens after the outcome of the 4 auctions of Italian government bonds.
The Ftse Mib index loses 0,59%. Paris resists (Cac40 +0,55%) while Frankfurt has reversed course and is now losing 0,16%. Decrease of 0,2% also for Madrid and Amsterdam.
Rumors of the possible resignation of Giulio Tremonti, although denied in the morning, contributed to the origin of the "freeze". The fact remains that the Italian Treasury has placed bonds for a total of 7,9 billion euros just below the maximum supply threshold (the offer target, 8 billion euros). In short, fears of contagion made themselves felt: the three billion euro of 10-year bonds were placed with a yield of 4,94%, the highest since November 2008. In the last auction at the end of May, the 4,73-year BTP had been placed at 1,33%. The level of demand was 1,50 times the value of the offer, down from 1,531 in the previous auction. The three-month Euribor, set at 27%, is also at its highest since March 2009, XNUMX.
THE FT: "BANKS, THE MAIN RISK FOR ITALY"
MPS AND BPM FALLING. THE UNIPOL STOCK COLLAPSES (-9%)
This morning's Lex Column of the Financial Times dedicates a disturbing analysis to our banking system, judged "the main risk to Italy's financial stability". The newspaper quotes an estimate by RBS Markets: the six major credit institutions hold government bonds for 200 billion euros, or about 13% of the total outstanding.
There is also concern about the perceived lack of capital. Unicredit and Intesa Sanpaolo are described as "relatively well capitalised". Other cases are instead brought as examples of the difficulties of the sector. The financial daily cites the case of Ubi, whose capital increase of 1 billion was 92% subscribed and of Banca Popolare di Milano, which will have to convince the market to inject new resources for 1,2 billion. In the absence of reforms capable of restarting the economy, the Column continues, "a large number of medium-sized lenders will face years characterized by low margins and low growth in lending activity." Investors can only hope for a new round of consolidation that could be accelerated by the sector's problems.
In such a context, the return of pessimism on banking stocks is not surprising. Starting from Monte Paschi (-5,2%) and Bpm (-4,1%). Intesa -0,8%, Unicredit -1%, Banco Popolare (-2,3%), Ubi (-1%) went negative. Victor Massiah, in an interview with Il Sole, welcomes the fact that the capital increase has been subscribed at 92,3% and denies any hypothesis of merger with Banca Popolare di Milano. The manager confirms the lines of the business plan which envisage growth along internal lines.
As for the cost of funding, Massiah believes the lowest point was in 2010.
The decline in the Italian banking sector is not matched by the Stoxx index of European banks (+0,2%) while the index of banks in the Eurozone is up by 0,6%. The indiscretions on the contents of the next government maneuver which aims to put a 0,05% tax on financial transactions and increase the levy on financial income contribute to making the situation worse.
Other financial stocks also fell: Mediolanum in asset management fell by 1,6%, Azimut -1,5%. Among the insurance companies, Generali loses 0,5%, Unipol collapses down by 9%. From the high of €0,556 on 28 April to today, Unipol has lost 40% on the Stock Exchange. Year-to-date performance is -29%. Fonsai is down again and loses 4%, while the subsidiary Milan drops by 2,4%.
MEDIOBANCA CONFIRMS FIAT'S TARGET AT 11,8 EUROS
ENI AND ENEL SHOPPING IN PARIS: POWEO IN THE SIGHT
The best sector in Europe is that of the car (+1,2%) . Fiat (+0,2%) awaits, as an interested spectator, the signing of the agreement on representation by the CGIL which could pave the way for a solution to the Fabbrica Italia case before the ruling on the Fiom appeal. Mediobanca today confirmed the outperform recommendation and the target price of 11,80 euro. In the note, the Milanese bank notes that at the end of 2011 the group's debt will have dropped to 5 billion euros from 6,3 billion at the end of 2010, thanks to the reduction in working capital and the good operating cash flow of the Chrysler subsidiary.
Eni and Enel (both -0,19%) are allegedly negotiating with the Austrian Verbund the purchase of the 46% stake in the French utility Poweo, an independent group which at the end of March had 363.500 customers, of which 263.700 in electricity and 99.800 in gas.
Poweo closed 2010 with revenues of 696 million euros, negative EBITDA of 7 million euros and a net loss of 133 million euros.
