Piazza Affari sinks after yesterday's rally. In the middle of the day, the Ftse Mib lost about 1,9% below 20.000 points and with only two stocks in positive territory: Pirelli, which gained more than 2,5% and came close to 4 euros per share after cashing in on Citigroup's promotion, which raised its rating to "buy", increasing the company's target price to 4,6 euros. Banco Bpm also floats after launching a Tier 2 bond half a billion. The rest is a massacre, from industrial and technological stocks to banking stocks: the worst in the middle of the day are Stm, Nexi, Atlantia and Buzzi, all with losses of over 3%. The day is negative, in truth, on all European stock exchanges (Wall Street reopens today, Monday closed for Labor Day): at the moment, the wait for the ECB meeting on Thursday prevails and pessimism has increased with the release of some disappointing macro data.
According to Eurostat, in fact, in the second quarter of 2020, the GDP of the euro area decreased by 11,8% in the euro area compared to the previous quarter. In the EU, the decline was 11,4%. “These – affirms the Institute – have been by far the sharpest declines observed since the beginning of the time series in 1995“. In the first quarter of 2020, GDP had decreased by 3,7% in the euro area and by 3,3% in the EU. Compared to the same quarter of the previous year, seasonally adjusted GDP decreased by 14,7% in the euro area and by 13,9% in the EU in the second quarter of 2020, after -3,2% and - 2,7% respectively in the previous quarter. Furthermore, according to Eurostat, the number of employed people fell by 2,9% in the euro area and by 2,7% in the EU in the second quarter of 2020, compared to the previous quarter. Again, this is the steepest decline observed since the time series began in 1995.
For Italy then came the rejection of Fitch, which lowered estimates of GDP performance in 2020 to -10% from the previous -9,5%, although on the other hand the rating agency has raised the projection for the expected rebound in 2021 to 5,4% from the previous estimate of 4,4%. The estimate for 2022 instead sees growth at a rate of 2,6%. As far as consumption is concerned, Fitch sees a contraction of 9,8% in 2020 with a recovery to 5,6% in 2021 and 2% in 2022. The unemployment rate should instead settle at 11,4% in 2020 and then rise to 11,4% next year and fall to 10% in 2022.
In Milan, the main banks also suffer: Unicredit -1,5%, Intesa Sanpaolo -1,3%, Ubi Banca -1%, Mediobanca -1%. The spread is steadily below 160 basis points, around 156 at mid-day, while The new 20-year BTP is immediately snapped up, which the Treasury launched on the market this morning and whose orders have already exceeded 64 billion euros. This was reported by financial sources according to which the books have been open since this morning and the closing of the operation is expected within the day. For the new 20-year benchmark expiring on 01/03/2041 the price indications, already reduced compared to the first issue, are around 9 basis points on the midmarket (it was +12 basis points at the start).
Meanwhile, the descent of oil continues, which in the morning ends up under 40 dollars a barrel for WTI, with Brent which instead stands at around 42 dollars a barrel. The euro falls below 1,18 dollars: Today it is worth around 1,178 greenbacks.
