The rain of sales on Italian banks does not stop, dragging the Milan Stock Exchange down. The Ftse Mib index lost around 1,3% around 16.200 points. Madrid falls by 1,2%. The Paris Stock Exchange is also down - 0,4%, Frankfurt -0,1% and London down by half a percentage point. The strengthening of the dollar continues, up sharply for the tenth consecutive day (ie since the election of Donald Trump) against all currencies. Yesterday, Fed Chair Janet Yellen said that a US rate hike was "imminent". This morning the dollar is trading at 1,059 against the euro, from 1,062 at yesterday's close. Since November 4, the US currency has gained about 5%.
Mario Draghi, opening the work of the European Banking Congress in Frankfurt this morning, reiterated that the ECB will continue its accommodating monetary policy. "Despite the recovery in prices due to the gradual closure of excess production capacity - he said - a lasting adjustment of the path of inflation still depends on the continuation of the current financial conditions, favorable as never before"." It is for this reason – he continued – that we confirm our commitment to maintain the very high level of monetary accommodation which is necessary to ensure the lasting convergence of inflation towards levels close to but below 2% in the medium term”.
New descent of BTPs, with the 2,13-year yield rising to 2,09% from 183% yesterday. Spread widening to XNUMX basis points.
Oil down, under the pressure of the increase in the dollar: Brent falls by 1,27% to 45,8 dollars a barrel, Wti to 44,7 dollars (-1,5%). OPEC members meet today in view of the official meeting on November 30th. Saudi Energy Minister Al Falih said he was optimistic that the production deal would soon be formalized. Russia is also willing to cooperate.
Eni drops by 1,9%. Saipem -1,6% Tenaris -1%.
At the center of sales in Milan are still the banks (-3% the sector index to its lowest level since 5 October) starting from Unicredit -1,65%. UniCredit's five-year credit default swap rose to 221,2 basis points from 219,8 basis points at yesterday's close. Deutsche Bank's CDS price trades at 218,4 basis points. Tonight the bank released a note in which it admits the possibility of an upcoming capital increase. The text reads: "the group is examining a series of alternatives and possible actions, including a possible capital increase".
Substantial losses also among cooperative banks: Banco Popolare -4,5% Ubi lose 2%. Moody's revised downwards the long-term rating assigned to bank deposits to Baa2 from Baa1 and that of senior bonds to Baa3 from Baa2, confirming the outlook at "Stable".
In decline Understanding -2,4% and Mediobanca down 3,4%, downgraded from Kepler Cheuvreux to Hold da Buy. MontePaschi loses 5,2%. Equita has dedicated a study to the consequences of Basel 4 on credit risk. A single-digit increase in risk-weighted assets (RWA) is enough to generate an impact on Cet1 of -50 basis points, equal to 6 billion capital. However, these changes could lead to an 8%-12% increase in risk-weighted assets with a negative impact of 80-116 basis points on the banking sector's Cet1 equivalent to a capital absorption of 8-11 billion EUR.
Insurance is also down. Generali -2% Unipol -1%. THE
The best sector in Europe is the Automotive sector (Stoxx +0,7%) driven by the increase in Volkswagen +1,5%, which has announced a drastic cost-cutting plan which envisages 30 layoffs by 2020. for savings of 3,7 .5 billion euros. Over the next 9 years, the focus will be on electric cars and digital mobility with XNUMX new hires in the software field.
Fiat Chrysler is equal, positive Brembo + 0,7%. StM advances by 0,1%. The turnover of the Italian-French joint venture is accelerating in the second half of the year, revealed the CEO Carlo Bozotti.
