Inflation is not yet under control in the Usa, based on personal data and Fed minutes announced yesterday. This will certainly postpone the moment when the Fed decides to start cutting rates. But the question now is: the ECB, who has repeatedly reminded us that he cannot ignore the moves on the other side of the Atlantic, how will he move? Today is the right day to get indications in this sense, with the usual meeting on the calendar Council of the ECB and from the words of its president Christine Lagarde the markets await enlightenment.
European stock markets expected to have little movement Today. The Eurostoxx50 future marks -0,04%, while Wall Street futures are just above parity (+0,06% on the Dow Jones and +0,08% on the S&P500) with the US Treasury yield 10 years increasing to 4,54%.
Fed data and minutes show that US inflation is not yet under control
Yesterday afternoon the first cold shower which affected the prices of all markets: US consumer prices in March they were higher than expected with a +3,5% year-on-year after +3,2% in February and against the +3,4% estimated. A figure still far from the 2% target Federal Reserve which, at this point, is unlikely to act on rates at the June meeting. Traders are now focusing on the month of September and analysts are betting on two reductions in the cost of money in 2024, by a quarter of a point each, for a total of 0,50%.
As if that wasn't enough, last night the now few arrived at the European markets Fed minutes which increased the dose. The recent inflation data are "disappointing", we need greater certainty on the progress on inflation "before cutting interest rates" we read in the minutes relating to the meeting - which ended on March 20 - of the Federal Open Market Committee (FOMC ), the Federal Reserve body responsible for monetary policy in the United States. On that occasion, the FOMC decided to keep interest rates at 5,25%-5,50%, the level to which they were raised in July last year, the highest since 2001. The bankers then reiterated that rates will have to remain high if progress on inflation stops. Interest rates were lowered to 0-0,25% in March 2020, to combat the negative effects of the coronavirus pandemic on the US economy, and then progressively raised from 2022. According to Philip Diodovich – Senior Market Strategist at IG Italia – US inflation figures highlighted inflationary pressures that remained strong. “Taking into account the robust figures on the world of work, we believe that the chances that the FOMC, the operating commission of the Federal Reserve, may decide to cut interest rates in the coming months are very low,” hypothesized the expert.
Wall Street reacted with a decline in the main stock indices, in a session characterized by a sharp increase in volatility. The Dow Jones closed 1,09% lower at 38.462 points, while the S&P500 fell 0,95% to 5.161 points. A minus also for the Nasdaq (-0,84% to 16.170 points).
Sales on banking sector securities. Stands out Goldman Sachs decline (-2,42% to 400,76 dollars). Intel also did poorly (-2,95%). On New York stocks Nvidia regains share (+2,05%), after the recent losses that cost it around 10% due to the negative closing of five out of six sessions.
Interlocutory Asia
Mixed session in Asia, which however suffers from the declines on Wall Street. Investors also found themselves evaluating data on consumer and producer prices in China for the month of March, which also showed that Asia's largest economy is experiencing a prolonged deflationary trend.
Weak session for the price list Tokyo, which ends with a drop of 0,35% on the Nikkei 225, while, on the contrary, a small leap forward for Shenzhen, which reaches 0,50%. Shanghai rises by 0,31%. Consolidates the levels of the day before Hong Kong (-0,06%); just above parity Alone (+0,26%). Closed for holidays Mumbai, ; goes down Sydney (-0,40%).
European stock markets saw little movement while awaiting the ECB
Today the spotlight shifts to ECB, from which no surprises on rates are expected, but the statements following the monetary policy meeting will be interesting to understand Eurotower's attitude towards the future. The major Italian Stock Exchange indices and the main European financial markets should start the day with fractional changes. Yesterday the US data ended up sending confusion to the European stock markets which wiped out their gains, then tried to recover but in the end closed in no particular order, marked by volatility until the last minutes of the session. Among the Eurozone indices, nothing has happened for Frankfurt, which changes hands at parity, London is resistant, which marks a small increase of 0,33%, and Paris is colorless, which does not record significant changes compared to the previous session.
The major indexes of the Italian Stock Exchange and the main European financial markets recorded strong volatility. The FTSEMib gained 0,27% to 34.040 points, after fluctuating between a minimum of 33.712 points and a maximum of 34.242 points. The FTSE Italia All Share rose by 0,23%. Negative closing, however, for the FTSE Italia Mid Cap (-0,35%) and for the FTSE Italia Star (-0,19%). In the session of 10 April 2024, the value of trade rose to 2,86 billion euros, compared to 2,64 billion on Tuesday.
What to watch today
We will obviously scrutinize the words of Lagarde what will be the future intentions of the ECB on rates, but if the prevailing mood is in favor of a prolongation of the status quo, the ones who will benefit from it can only be first of all the banks.
Already yesterday the headlines of banking sector have recorded strong increases and today they will be followed again. Yesterday Intesa Sanpaolo it gained over a percentage point (+1,16% to 3,35 euros). Better performance for the Monte dei Paschi di Siena, which rose by 4,83% to 4,167 euros, even after the words of minister Giancarlo Giorgetti who was convinced that 2024 'must be the good year'. Popolare di Sondrio also did very well (+3,44%).
On the Milanese price list today, pay attention to Stellantis for the decisions it will take regarding some Italian factories. Exor, the holding company that controls, among others, Stellantis, Iveco and Juventus, closed 2023 with a consolidated profit of 4,194 billion euros, down by 33 million compared to 4,277 billion in 2022. The Nav (net asset value) and ' rose by 25,7% to 35,513 billion, with the Nav per share increasing by 32,7%, with a performance superior to that of the MSCI World index by 15,1 percentage points, an increase mainly determined by the performance of the Stellantis and Ferrari stock prices.
Eyes a Enel following the accident in the Bargi hydroelectric power plant, in the Bologna Apennines. Enel Green Power has established an immediate fund of 2 million euros to allow the people involved and their families to meet basic needs and emergencies.
Saipem. Norges Bank, the central bank of Norway, has a 2,718% stake in Saipem, a services and solutions company for the energy and infrastructure sector. This is what emerges from Consob communications relating to significant shareholdings, where it is reported that the operation dates back to 9 April 2024. The day before, 8 April, it was at 3,298%. JP Morgan raised the target price to 3,2 euros
Snam. From the same communications it emerges that Lazard Asset Management has a 5,073% stake in Snam, an energy infrastructure company listed on Euronext Milan. The portion is classified as "discretionary savings management".
Safilo Group – a company listed on Euronext Milan – and Marc Jacobs have early renewed their multi-year global licensing agreement for Marc Jacobs eyewear collections. The agreement is valid until December 2031. Saes Getters – a company listed on the STAR segment and active in scientific and industrial applications that require high vacuum conditions – announced that the board of directors has authorized the signing of a binding share purchase agreement for the acquisition of 100% of the capital of FMB Berlin. Based on the adjusted EBITDA achieved in the period 2018-2023, the enterprise value of the German company was estimated at 8 million euros. Saes Getters expects the contract to be signed on April 18, 2024. The transaction is expected to close on April 29, 2024.
Alfa Romeo has unveiled its baby SUV Milan: it is electric or hybrid. Biscione's first electric car boasts 410 kilometers of autonomy but is also a two- and four-wheel drive hybrid
Tim is among the signatories of a joint letter, together with Deutsche Telekom, Orange, Airbus and 14 other European companies, criticizing a proposal that would allow Amazon, Google and Microsoft to participate in tenders for cloud computing contracts in the Union European.
In the luxury sector, BRUNELLO CUCINELLI recorded a good performance in the first quarter, with a positive result also in the United States and China, as said by the founder and executive president, Brunello Cucinelli, Safilo early renewed the multi-year global licensing contract for the Marc Jacobs eyewear collections until in December 2031.
The euro loses ground, gold still well bought
The euro it loses 1,02% and slips to 1,074 dollars. The bitcoin rises again above 70.777,43. against the euro it is at 65.172,59. The BTP-Bund spread is at 135 basis points down 0,35%. the yield of the ten-year BTP is 3,78%.
At 10am, Italian industrial production for February will be released (previous: -1,2% year on year), while in the afternoon (14pm) weekly requests for unemployment benefits in the United States (previous: +30 to 9.000) and March producer prices (previous: +221.000% month-on-month; consensus: +0,6% month-on-month).
The prices of Petroleum rose slightly (WTI +0,17% to 86,36 dollars a barrel and Brent +0,18% to 90,64 dollars a barrel) and remained close to the highs of the last five months after the Israeli air attack in the Strip Gaza, which reportedly killed three sons of a Hamas leader on Wednesday, has fueled growing concerns that ceasefire talks are once again falling apart. Furthermore, data showed that US crude oil inventories grew more than expected. While the surge in the dollar, which has reached the highest levels of the last five months, slows down the growth of crude oil prices.
Prices Of their they started to rise again (+0,55% to 2.361 dollars per ounce) after higher-than-expected inflation data in March in the United States dragged the yellow metal sharply down from historic highs, even if demand safe haven and central bank purchases have kept prices close to recent peaks. On the one hand the expectation of higher rates for longer will limit gold purchases, but on the other hand major central banks in Asia and other emerging markets are increasing their gold reserves, which is pushing prices higher. Recent data showed that the People's Bank of China purchased gold for the 17th consecutive month.
