European stocks close in deep red and Wall Street travels in rapid reverse on this day at the end of September, a volatile month by tradition especially on the American market. Government bond yields and the 1,52-year US Treasury exceeds XNUMX%.
On the Italian secondary, the gap between the BTP and the Bund is growing. The spread salt to 106 basis points (+3,63%) and the BTP rate goes to +0,86% (Bund up to -0,2%).
It is also confirmed oil in cash (although in the last half hour futures have changed sign), which with its rally offers a ledge to securities in the sector, but exacerbates concerns about inflation and the repercussions that this can have on central banks, even if presidents of the ECB and the Fed they try to put an end to fears and they reiterate that the surge in prices should prove to be "temporary". OPEC is not even afraid of the green revolution and expects it demand for oil, globally, will continue to rise for the next 25 years.
In this context, the dollar is once again a magnet for purchases and its index, against the main currencies, shows an increase of 0,4%.
In European equities Frankfurt loses 2,11%, Paris 2,17%, Amsterdam -1,9%, Madrid -2,6%. Limit damage London, -0,51%.
Piazza Affari loses 2,14% and drops to 25.573 points, with only one positive blue chip: Eni +0,7%. The day's damage account starts from Amplifon (-5,15%), which is confirmed as strongly negative after yesterday's slide. Stm takes a nasty blow, -5,02%, in line with the sector at European level, overwhelmed by sales in the wake of those on Wall Street technology stocks, in turn linked to the rise in T-Bond rates. The balance is heavy for Nexi -4,12%; Interpump -3,89%; Diasorin -3,07%. Most of the banks, after a well-tuned eve, score significant falls, starting with Unicredit. -3,97%, followed by Banco Bpm -2,65%. Among the financial Fineco -2,74%. In the automotive sector, the worst performance is that of Stellantis -2,98%.
There is no joy for the luxury stocks (Moncler -2,9%) due to the news from China which, since the morning, have contributed to fueling an overall aversion to risk. Profit growth at manufacturing in the world's second-largest economy slowed in August and Goldman Sachs and Nomura revised their 2021 growth projections downward as the energy supply crisis prompted factory closures and, for the global economy, this could pose a much greater threat than the Evergrande Group debt crisis.
The climate is not serene even in the US and the New York Stock Exchange could end the month lower, although the quarter will remain positive. Among other things weighs the need for an agreement in Congress to finance government activities and prevent the shutdown from triggering on October 18st; moreover, the problem of the federal debt limit, which must be increased or suspended to avoid default, needs to be resolved. At the moment, Republicans have blocked a Democrat bill that would have solved both problems. Today, Treasury Secretary Janet Yellen sent the third letter in a few weeks to Republican and Democratic leaders, urging them to act soon: "We now estimate that the Treasury will likely exhaust its extraordinary measures if Congress does not act to lift or suspend the debt limit by October XNUMX”.
Meanwhile, the rise in T-Bond rates is reflected in a sale of tech and in a preference for cyclical stocks, while oil increases the risk of inflation, even if, at the moment, Texan crude shows a slight decline. Almost all investment banks are reselling the price of black gold upwards for the current year. From the central bank front today Jerome Powell he will speak to the US Senate Banking Committee and say, as anticipated to the press, that the economy has continued to strengthen, but "unemployment continues to weigh disproportionately on low-income workers in the service sector, on African Americans and Latinos" , while “inflation is high and will probably remain so in the coming months, before slowing down”. In parallel, the President of the European Central Bank, Christine Lagard, states that the reaction to the temporary price increase should not be exaggerated. “The key challenge is to make sure we don't overreact to supply-side issues that won't spill over into the medium term, while at the same time tending to positive demand forces that could drive inflation towards our 2% target lastingly". "We will only react to improvements in inflation reflected in underlying inflation dynamics." "We see no signs of an expansion of the inflation increase to all sectors of the economy."
So they go on pandemic purchases of the European Central Bank, which increased slightly in the last week but should slow down in the next three months: 20,37 billion euros, up slightly from 19,12 seven days ago.
On the foreign exchange market, the euro is trading below 1,17 against the greenback. Sterling plunges on rising US Treasury yields and worries about the economic impact of the fuel shortage in the UK. In fact, the supply difficulties following Brexit are worrying investors, who have effectively ignored the Bank of England's openings on an upcoming interest rate hike.
Among the macroeconomic data of the day, the US markets suffer a drop in American confidence in the economy compared to the previous month and compared to analysts' forecasts, due to the spread of the Delta variant of the coronavirus and the increase in prices. In Germany, however, the opposite is happening and German consumers appear more optimistic.
