“People hate inflation. We do it too." As Jerome Powell during the press conference at the end of the Fed meeting which, as expected, left i unchanged rates. But the decision was accompanied by a much harsher comment than expected. It is very likely, in fact, that the central bank will raise rates further between now and the end of the year, as 12 out of 19 members of the board have requested. Not only. Rates are destined to remain high for a long time. In 2024 there will be some downward adjustments, but it will still remain above 5%, at historic highs. “Higher rates for long? No, maybe forever” headlines the Wall Street Journal commentary noting that the “neutral rate” tends to grow. Technicalities aside, this means the economy is stronger than expected but so is theinflation. “It's good that the economy is strong. It is good that the economy has been able to withstand the tightening that we have implemented. It's good that the job market is strong – said President Jerome Powell – the only concern is that if the economy is stronger than expected, it means that we will have to do more in terms of monetary policy to get back to 2%”.
Europe in red in the wake of Wall Street
The Fed's "hawkish" tone was immediately reflected Wall Street which closed in the red: Yesterday at the end of the session, the S&P500 recorded a decline of 0,9%. The negative change in the Nasdaq -1,5% is more significant. In the wake of Wall Street, the opening of the European indices is tinged with red.
Il dollar jumped to six-month highs of 1.0617 on theeuro at a time when the Fed has clearly stated that rates will remain around 5,10% in 2024, dampening hopes of a deep cut next year.
New record for the US biennial since 2007
The indications of the members of the Federal Reserve on the path of inflation have pushed bond yields higher. Ten-year Treasury Notes are at 4,45%, a new high since 2007. The two-year bond has reached 5,17%, the highest since 2006.
The monetary tightening is starting to weigh on construction: in August new construction sites fell by 11,3%.
A new wave of car strikes, despite the new offers arriving from Stellantis and the agreement between Ford and the Canadian union.
Asia is in red. Tokyo, 14.200 billion in the hands of families
The moods of US bags have infected the Asian stock markets this morning, awaiting the next meeting of the Bank of Japan which could tomorrow give a first turning point to Tokyo's monetary policy centered on the zero rate.
As a reminder of the effect that a change in families' portfolio choices could have, the Boj's update on the value of financial assets in the hands of Japanese families arrives this morning: 14.200 billion dollars or 2,1 quadrillion yen.
The MSCI index Asia Pacific is declining this morning for the fourth consecutive day. Nikkei's Tokyo -1,2%. Hang Seng by Hong Kong -1,4%. CSI 300 of the price lists Shanghai and Shenzhen -0,6%. Kospi of Alone -1,5%. BSE Sensex of Mumbai -0,5%.
Milan at the top since the beginning of August
Even the European stock exchanges, including Business Square, are set to open lower: Eurostoxx futures mark -0,1%.
Yesterday the Ftse Mib of Milano it closed up 1,6% on the highest levels since the beginning of August. All sectors went up a bit, except Oil. Real Estate and Automotive the best with +2%.
The European Central Bank is “more or less” at the peak of its interest rate hike cycle although next March will probably still be too early for a first rate cut, according to the Governing Council member Gabriel Makhlouf. “My view at the moment is that March is probably too early,” Makhlouf told an Irish parliamentary committee when asked whether the ECB could cut interest rates as early as March, after raising the key rate. to a record high of 4% last week. “I said before the summer that we were getting close to the top of the interest rate ladder and I think we're almost there.”
The Bund starts again at 2,7%. BTP at 4,44%. spread to 174 points.
Rates drop, but in Brazil
Waiting for the decisions of Bank of England, which is expected to raise rates again, the markets take note of the cut in the cost of money in Brazil. The central bank cut the reference interest rate by half a percentage point for the second time in a row to 12,75% and signaled in the statement that it intended to continue with this approach at least until the end of the year. The members of the Committee unanimously expect further reductions of the same size in the next meetings – reads the press release – This pace is appropriate to maintain the necessary monetary policy monetary policy necessary for the disinflation process”.
Tonight the Sao Paulo stock market closed up by 0,7%.
The Fed deflates oil prices
Petroleum down 0,7%: Brent 92,90 dollars, Wti 89. The price is moving away from the peak of the last ten months, following the Fed's warning about a possible increase in US rates. This indication has likely triggered profit taking, although the concern of limited supply remains.
Il European natural gas it gained 1,4% yesterday, closing at 37,30 euros/mwh. News from Australia: Chevron and unions are close to a deal to end strikes at liquefied natural gas export plants that have rocked global markets.
Safilo teams up with Amazon, Mediobanca looking for proxies
Mediobanca. The outgoing board has developed his list for the renewal with the indication of the confirmation of the current president Renato Pagliaro and the CEO Alberto Nagel. The Board of Directors also decided to promote a solicitation of proxies by entrusting Morrow Sodali with the role of person in charge. The board approved a letter, sent to partners Delfin and Francesco Gaetano Caltagirone, reiterating that Delfin's proposals on governance were not aligned with the governance model of a listed systemic bank.
stellantis. The United Kingdom has moved forward the entry into force of new regulatory rules for petrol and diesel vehicles to 2035, from 2030 previously expected. Stellantis will lay off 68 workers in Ohio and plans to do the same to 300 others in Indiana due to the ongoing United Auto Workers strike at the Jeep plant in Toledo, Ohio.
Tim, kkr and the Ministry of Economy will ask Tim's Board of Directors more time to submit an offer for the purchase of Netco, the company where the former monopolist is preparing to merge the fixed access network and Sparkle. Three sources close to the situation told Reuters.
OVS extension closes its 2023 half-year report (from February 1st to July 31st) positively on all or almost all indicators. Net sales reached 734,9 million euros, (+4,1% compared to the first half of 2022) mainly thanks to the sales performance on a like-for-like basis. The adjusted net profit for the half-year amounted to 33,7 million euros, (+5,5%). “In the second half of the year – declared CEO Stefano Beraldo – the good sales trend is expected to continue. In terms of margins we expect an improvement, above all thanks to the reduction in the costs of raw materials".
sapphire he announced with Amazon the launch of new smart glasses in the US market under the Carrera brand and with the Alexa voice service.
