Uncertainty about US debt and about the next moves by the Fed and the ECB weigh on continental stock markets which continue on the path of weakness despite the brilliant performance of the Hi-Tech sector. Having archived the attempts to rebound seen at the start, the continental stock exchanges travel in the red by mid-morning, with Business Square which yields -0,6% weighted by the banks and by Telecom Italia.
The other squares are weak: Madrid (-0,68%), Frankfurt (-0,37%). TO Parisi (-0,19%) the debacle of Casino that upon resumption of listing after a three-day suspension, it yields 8,6% of its value with the market reacting to the start of a conciliation procedure with creditors and to the agreement for the sale of around one hundred points of sale in France. It is just below parity (-0,1%) London, while Amsterdam manages to save itself (+0,28%).
Today's macro data
After the expected data on GDP and US inflation, both higher than expected, this morning in Great Britain the numbers relating to the retail sales, rose in April by 0,5% in volume compared to March. On an annual basis, the decline was 3%, slightly down on the -3,9% recorded in March. Compared to the pre-coronavirus (COVID-19) level in February 2020, total retail sales increased by 16,5% in value terms, but volumes decreased by 0,8%.
From Istat came the data on the consumer confidencethe. In May, the consumer confidence climate index decreased from 105,5 to 105,1, while the composite business confidence climate index decreased from 110,4 to 108,7. Business sentiment increased from 119 to 119,8 while personal, current and future sentiment decreased from 100,9 to 100,1, 100,2 to 100,0 and 113,3 to 112,6, respectively) .
Patuelli and Enria at the Trento Economics Festival
At the Trento Festival of Economics, the number one of the Abi Antonio Patuelli replied remotely to the president of the ECB, Christine Lagarde, who had hoped for a rise in remuneration on deposits by banks (in the light of the increase in interest rates in Frankfurt). “I signal to Lagarde to be more equanimous: if you invoke something, you invoke it for all not just some. The interests of bank current accounts are very competitive and more profitable than postal ones. We can't be the only ones reprimanded." Speaking then of the possible introduction of a tax on the extra profits of the banks, Patuelli stated: “Extra-profits do not exist in doctrineotherwise there would also be extra losses. We come from a decade of extreme difficulty for banks, in which they found themselves facing problems alone. We are the only sector that, when one bank goes badly, the others instead of taking advantage of it are called to solidarity” and “if the State could not help the banks when they were in difficulty, it cannot now take advantage of a moment of recovery”.
Finally, commenting on the current international economic situation, the president of ABI said worried about the impact of the German recession: “I fear that the impact on GDP is of a further slowdown, because the GDP forecast in 2023 is lower than that of the previous year and the forecasters did not take into account the brakes of the German locomotive, with which Italy works with large exports and the production of components”.
The number one of the ECB Supervision also spoke in Trento, Andrea Enrico, according to which "the health of European banks is good, in terms of capital solidity, liquidity and profitability, the situation is very good”. However, Enria warned: “It is a period of still high risks, with rising inflation and the rapid exit from negative interest rates also posing risks and it is important that European banks are also on the alert”.
Responding to the question of a saver who asked him about the low rates that banks continue to offer to remunerate the liquidity of retail customers on current accounts, Enria said: "You are right: there must be a time when competition pushes rates up and perhaps that time has come. There is not enough competition in Europe”.
Banks in red in Piazza Affari
Sales in the banking sector kick off in Milan with the sector index losing more than 2%. The worst is Ps (3,25%), followed by Bpm bank (-2,64%), Intesa Sanpaolo (-2,36%), B for Bank (-2,06%) And Unibelievet (-1,64%).
Also in red Generali (-1,7%) after the quarterly, while uncertainty about the future continues to weigh on Telecom Italy. In the middle of the day, the share recorded -1,38% at 0,2564 euros per share, reaching its lowest since January, while expectations are rising for the new offer that the Kkr fund, a competitor of the duo, is preparing to deposit on 9 June Cdp-Macquarie. The fear, however, is that some technical details of the proposal will be revised, rather than the economic consideration, which according to rumors was around 19 billion euros. A figure judged too low by the shareholder Vivendi, who values the network at 31 billion euros and who, according to rumors, would be willing to come to terms for a value of 26 billion euros, but no less.
Moving on to the good news, the best headline of the day is Interpump (+0,78%), followed by Cnh Industrial (+0,7%) and from Stmicroelectronics following the excellent performance of Nvidia (+24,3% on Thursday) and gaining 0,68%. Positive too Moncler, Hera and Terna, which show increases between +0,4% and +0,6%
Gas at its lowest since May 2021
On the bond, lo spread between BTPs and Bunds travels up to 189 basis points (+2,4%), with the yield on the ten-year BTP benchmark up to 4,39% from 4,34% of the previous reference. On the currency market, it is weak the euro which travels at 1,0735 on the greenback.
However, investors' attention is focused on gas. Mid-morning the price of Natural Gas TTF on the Amsterdam market it is in sharp decline to 25,3 Eur/Mwh, after having reached its lowest since May 2021. Since the beginning of the year, the decline is -67%. Contributing to the reduction in prices is above all the weakness of private and business consumption, which continue to burn less gas after the surge in prices triggered by the war in Ukraine. The filling rate of EU storages also weighs, already reaching 66% and which could rise to 100% as early as August, well in advance of the start of the heating season.
