After the preventive rejection of the budget manoeuvre on the part of the EU, the week of Piazza Affari starts in deep red. A little over an hour after the opening, the Ftse Mib left 2% in the field, falling below 20 thousand points (at 19.944,74). None of the stocks with the highest capitalization travels in positive territory. Among the worst are Bpm bank (-4,7%), Azimuth (-4%), Where's Banca (-3,5%), Bper (-3,19%) And Post (-3%). Rain of sales also on the big banks (Understanding e Unicredit -2,8%) and on industrialists (fca -2,1% Leonardo -2,7%). The energy discounts are more contained (Eni -1,5% Enel -0,9%).
In the same minutes, it BTP/Bund spread travels close to 300 basis points, with the yield on ten-year public bonds rising to 3,55%.
CHINA: YUAN AT A LOW, STOCK MARKET PEAK
Bitter return from holidays for Chinese finance. Despite a new injection of liquidity, the fourth of the year, the CSI 3000 index of Shanghai and Shenzhen shows a loss of 3,7% (over 15% since the beginning of the year), while the yuan slips to its lowest level since May 2017. The markets, closed last week for the New Year's celebrations, are thus belatedly registering the impact of Bloomberg's revelations on the spy hardware included in the components destined for about thirty American hi-tech companies. Meanwhile, it turns out that in the NAFTA 2 treaty signed with Mexico and Canada, the USA demanded to be informed about "any agreement with non-market economies", a clause that Washington intends to insert in every commercial treaty with the intention of encircling the Chinese enemy.
STOP TOKYO, COLUMBUS DAY IN USA
The descent of Hong Kong also continues (-0,7%), already hit on Friday by the news that marks a new heavy blow to the globalization of the economy. The other open Asian listings were also down. Stop Tokyo for holidays.
Even Wall Street will be mid-service today for the Columbus Day holiday: the bond markets will be at a standstill.
THE RIGHT TRIUMPHS EVEN IN BRAZIL
But there is no shortage of news on the geopolitical front. Worth noting is the new electoral victory of the populist right, this time in Brazil, where Jair Bolsonaro obtained 46,7% of the votes in the first round of the presidential elections, with a great advantage over the leftist candidate Fernando Haddad, stuck at 29%.
ARABIA DOES NOT INCREASE PRODUCTION
In the meantime, oil is holding back: Brent at 83,25 dollars (-1,1%), Wti at 73,74 (-0,8%). Saudi Arabia has no plans to ramp up crude output in response to the price rally in recent weeks, the Crown Prince of Riyadh said in an interview over the weekend. Meanwhile, Washington is trying to tighten its grip around Tehran, strengthening the front between the countries that do not intend to continue buying Iranian crude.
From the communications on trade released in Washington on Friday evening it emerges that China, since August, has eliminated imports of US oil: absolute frost now reigns between the two superpowers.
EURO WEAK, TENSION RISES BETWEEN ROME AND EU
The weakness of the euro, traded this morning at 1,151 against the dollar, anticipates the tensions that will dominate the financial markets of the Old Continent. In particular, it is not difficult to predict a high-voltage opening for Piazza Affari after the negative reception of the maneuver by the EU Commission and the belligerent proclamations of the yellow-green leaders.
While awaiting the parliamentary examination of the Nadef (the note updating the economic and financial document), the spread trend is expected to be in line with the trend of the last few sessions. The spread shot up from around 236 points on 27 September to 283,9 points on Friday, reaching a peak of 301 points on 2 October last, with the yield on the Italian ten-year BTP jumping from 2,9% on 27 September to 3,4 .XNUMX%.
BOTS AND BTPS OFFERED, AUCTION ALSO IN GERMANY
In this climate, the auctions of government bonds will be held this week. The Bot auction is scheduled for Wednesday. The next day it will be the turn of medium and long-term securities. There was much anticipation on Wednesday also for the offer of ten-year German bunds which rose during the week from 0,42% to 0,56% in the wake of US Treasury rates.
Today at Palazzo Chigi, the meeting between Prime Minister Giuseppe Conte and Michel Barnier, head of the EU delegation in the talks for Brexit, is scheduled. On Wednesday, the heads of government of the EU will define the proposal to define future relations with London.
IMF MEETING IN BALI, US QUARTERLY REPORTS UNDERWAY
No less turbulent is the atmosphere of the annual meeting of the International Monetary Fund scheduled for today in Bali. The conflict over data between the US and China, which is threatening to give an iron curtain in electronic format, will be kept silent. According to the Tiger Index elaborated by the Brooking Institution, global growth remains strong, but the risks for emerging economies are growing, while advanced economies (Italy in the lead) do not have the ammunition to face a possible slowdown in the economy.
On the corporate front, the most important event is the opening of the Wall Street quarterly campaign. It starts on Friday with JP Morgan, Citi and Wells Fargo.
ASTALDI EXCLUDED FROM THE STARS, CREVAL MEETING
At Piazza Affari tomorrow Astaldi will be excluded from the Star purchase. The calendar foresees the meeting of Credito Valtellinese on Wednesday.
Negative balance for Piazza Affari in the last few sessions, after the first indications contained in the Def emerged. Since the first announcements, which took place in the late evening of Thursday 27 September, the Ftse Mib has lost 5,4%. In the last week (Friday to Friday), the index instead recorded a drop of 1,77%.
The sales mainly hit bank securities, which move inversely proportional to the spread. In particular, the former popular companies paid the heaviest bill in terms of capitalization, with Bper down by 7,9%, Ubi by 7,4% and Banco Bpm by 6,7%.
Frankfurt lost 1,1%, Madrid 1,4%. Paris (-2,4%) and London (-2,5%) fared worse.
