Positive opening in Piazza Affari, where half an hour after the start of trading, the Ftse Mib index gained 0,6%, after having touched a peak of 1% a few minutes earlier. But soon red came: shortly after 11, the FTSE MIB lost 0,60. The other European price lists are also close to zero.
BERLUSCONI: ITALIANS IN RETIREMENT AT 67 YEARS OLD
FOR NOW EUROPE IS ONLY LAUGHING AT US
Ireland is emerging from the crisis, Spain and Portugal are on the right track. It's Italy? Nicolas Sarkozy and Angela Merkel allow themselves a gag that is worth more than an ultimatum. "Now we will meet Berlusconi and Papandreou". But if Greece is the homeland of tragedy, Italy, in the eyes of the partners is the land of comedy, of which the prime minister is the undisputed protagonist. “We were elected – says the French president – to take care of France and Germany but we must also worry about the problems of other countries…”. “Chancellor Merkel and I met Berlusconi and Papandreou to remind them of their responsibilities and the decisions they have to make,” French President Nicolas Sarkozy said at the press conference. "We had a conversation with the head of government of this great country, Italy, (that is) with our interlocutor, and obviously we have faith in him," Merkel concluded diplomatically, referring to Berlusconi and answering a question from a reporter who asked her if she trusts the Prime Minister. It is within this framework that the ultimatum to Italy fits: by Wednesday, the date of the second summit, the Italian government must present itself with a package of convincing measures to attack the knot of public debt, those 1.900 billion which weigh, as a sword of Damocles, on the fate of Europe. The answer, in words, was not long in coming: the prime minister announced a council of ministers in which the extension of the retirement age to 67 years will have to take shape, despite the resistance of the League. There seems to be no more room for deferrals and compromises. "If the Italian debt remains at 120% of the gross domestic product – Merkel warned – the height of the protective wall that we will be able to build will no longer matter: the markets will not restore confidence in the euro area".
AGREEMENT ON BANKS: 108 BILLION CAPITAL IS NEEDED
BUT ON THE BOTTOM SAFE STATES BERLIN AND PARIS ARE FAR AWAY
For the rest, the summit was, as expected, of an interlocutory nature. The only concrete decision concerns the appointment of mister euro, the Belgian Herman Van Rompuy, who inaugurated his mandate by also launching an ultimatum to Italy. The agreement on the recapitalization of the banks seems ready, Berlin and Paris are still distant on the nature and means of endowment to the bailout fund and on the modalities of the rescue plan for Athens, starting from the sacrifices to be asked of the banking system, in particular the French one. European banks will have to strengthen their capital by 108 billion within the next 3-6 months. This injection of funds, according to calculations by the EBA, the European banking body which conducted the stress tests, should allow the system to reach a core tier 1 of 9 per cent, sufficient to recover market confidence or face the impact of possible systemic sovereign debt crises. This is the first significant result of the first Eurozone summit. But the official announcement will take place after the second summit on Wednesday, in the hope that in the meantime there will be an agreement on the state-saving fund, necessary to give life to that "ambitious and global" agreement promised by the Merkel-Sarkozy couple. Indeed, the ritual of this interminable confrontation between the top leaders of Europe envisages: a) a second summit of the 17-country euro zone, which has just appointed Herman Van Rompuy, current president of the European council, as its president, and a second summit to 27, i.e. from the countries of the European Union, as requested by the United Kingdom and Poland; c) Angela Merkel's report to the Bundestag which will have to be pronounced before the German signing of any agreements on the state bailout fund, the EFSF, as envisaged by the Constitutional Court of Karlsruhe. But, beyond the diplomatic problems, the agreement on strengthening the stability fund is still a long way off: France insists that the EFSF be transformed into a bank with free access to the ECB; a bank perhaps also open to Gulf or Asian sovereign funds rather than to other institutional investors who could buy sovereign debt securities by obtaining financing from the ECB. In this way, objects Berlin, supported by the partners of the North, opens the way to the monetization of the debt. Moreover, without guarantees from the most defaulting shareholders. That is Italy.
BANKITALIA, TODAY THE COUNCIL'S YES TO IGNAZIO VISCO
THE PUBLIC DEBT FACE THE TEST OF AUCTIONS
The candidacy of Ignazio Visco is today being examined by the Superior Council of the Bank of Italy whose senior adviser, Paolo Blasi, has already anticipated his highly positive judgment on the name of the candidate indicated by the Prime Minister. Already this week, after the body's opinion, Visco's candidacy will be examined by the council of ministers to then be forwarded to the President of the Republic, who is responsible for the nomination decree. Meanwhile Visco is already at work in via Nazionale: time is running out. Even if Visco is thoroughly familiar with all the main Italian and foreign dossiers and he sits at the development table organized by Economy Minister Giulio Tremonti. The spotlights of the Stock Exchanges will be concentrated on the tensions in the euro area, starting from Piazza Affari. But the real test by fire will take place on Wednesday when, simultaneously with the Brussels summit, the maxi auctions of the Italian Treasury will be held: 10,5 billion BoT and Ct, followed by 9 billion Btp and Cct in the following days, Italian Treasury issues, both on primary and secondary, will thus be the first to register the market reactions to this round of historic decisions taken in Brussels, as is logical given that the 1.570 billion euro of BoT, BTp, CcT and Ctz in circulation are now the first item on the agenda in the redefinition of the size and functioning of the EFSF State-saving fund and the recapitalization mechanisms of European banks.
ASIA, RECORD OPENING THANKS TO US EXPORTS AND GDP
WEN JIABAO CONFIRMS THE SQUEEGEE FOR THE CHINESE ECONOMY
While awaiting Europe's decisions, Asia opened the week focusing on better-than-expected macro data. Indeed, in September, the increase in maritime traffic confirms a robust recovery in exports from Japan, while Chinese industrial production closes with a new percentage increase, the first of the quarter. Added to this are the indications coming from the United States: GDP in the third quarter probably rose by at least 2,5%, double the 1,3% between April and June, in turn recovering compared to the beginning of 2011. And so the Nikkei 225 opens the week at +1,7%, the Korean Kospi rises at +2,7%, Hong Kong's Hang Seng rebounds at +3,92%. More cautious Shanghai +0,4%: Wen Jiabao confirmed that China will not reduce monetary tightening to cool the economy. The only sign of concern concerns the growth of gold to 1.647 dollars.
AUTO, VOLKSWAGEN BURNS THE COMPETITIONGM AND TOYOTA
FIRST IN THE WORLD ALREADY IN 2011 (7 YEARS IN ADVANCE)
Earthquake in the car sales charts. The consulting firm JD Power has anticipated that at the end of the year the new queen of the market will be Volkswagen with 7,8 million vehicles sold worldwide. In second place will be GM, with 7,2 million. In third position, the Nissan Renault duo takes the podium with total sales of 6,8 million. Toyota, number one for years, plunges into fourth position with 6,7 million units, also due to the effect of the tsunami. But this is not the only reason for Volkswagen's climb, which reaches the top of the world seven years ahead of the schedule drawn up in Wolfsburg. The German group is the only one growing on the market of the Old Continent +7% while all competitors, including Fiat, show declining sales in Europe. To this must be added the boom in sales in China: even in 2011, despite the constraints on sales that have held back the market, the German group headed by Winterkorn is up 8 percent.
BUSINESS EDISON IN THE STREAM
PARIS OFFERS A TOTAL OF 1,15-1,3 EUROS
Edf's offer for Edison could already arrive today on the table of Delmi and Minister Paolo Romani. The supervisory board of A2A has already been convened for next Thursday for the probable go-ahead for the operation to be concluded by October 31 to avoid the Italian-French auction. According to rumors, the Parisian group is ready to immediately take over the entire share of Delmi (30% of the capital) at a total price between 1,15 and 1,3 euros, less than what was requested by the Italian partners headed by A2A but with a significant premium compared to stock market valuations, around 0,9 euro. Henry Proglio, in particular, is ready to offer 0,95 euro in cash (slightly above the stock market value) plus an adjustment in assets, i.e. Edison's hydroelectric plants, while there is no interest in wind power (which Edf tries to insert into the match). The issue of the takeover bid remains open. With the exit of Delmi and the dissolution of Transalpina per l'Energia, the mixed holding which controls 61% of Edison, the conditions are in place to force EDF to launch the takeover bid, even if the transalpine group will try to avoid this further disbursement. For the rest, everything is defined: A2A will transfer two combined cycle plants to Edf, while the three hydroelectric plants of Edipower will flow into the newco with Iren controlled by A2A itself with 66%. The Swiss Alpiq will be rewarded, at the time of the stew, with the Piacenz plant, while Edf will take over the other plants (three gas, one coal). Dolomiti Energia and Sel will receive minority shares in the hydroelectric sector.
