The European stock exchanges are starting to run again in the wake of rumors about the first agreements made in view of the summit, which will begin at 18 pm in Brussels. It is now virtually certain that an agreement has been reached on the recapitalization of banks, with the obligation for European institutions to bring their Core Tier 1 to a minimum of 9% of total capital. Even the mandate collected by Merkel from the German Parliament gives new confidence to the stock exchanges.
Around 16 pm Milan gains 1,34%.
The euro started to rise again and is quoted at 1,393 against the dollar.
The rise in crude oil does not stop with the American WTI traded this morning at 93,7 dollars a barrel (+0,2%). Brent is worth 111,4 dollars.
The Italian premier Silvio Berlusconi will be at the European summit in Brussels today to illustrate the commitments for growth gathered in a letter on which he worked until late in the evening negotiating with the League, which is opposed to interventions on pensions. The newspapers are talking about a mini-agreement on retirement at the age of 67 in 2026; however, no agreement would have been reached on old-age pensions. Yesterday the leader of the Bossi league said he was pessimistic about the stability of the government. All eyes are now on the response of Europe, which had pressed for the Italian government to present itself today with new development measures, and on that of the markets. The yield of the ten-year BTP is up to 5,95% (+2 basis points), the spread with the Bund is at 390 points.
The Treasury placed 8,5 billion six-month BOTs on the market at a rate of 3,535%, up sharply from the 3,071% of the September auction. Although slightly decreasing, the demand was totally satisfied. Two billion Ctz maturing in 2013 were also placed today with a yield of 4,628%. The demand was equal to 2,01 times the amount offered.
Among the blue chips, Fiat Industrial stands out, up 2,34% on positive expectations in view of the data for the third quarter. AGCO and Paccar in the US and Volvo in Europe announced their quarterly accounts yesterday.
The indications that emerge are, as far as trucks are concerned, of significant growth in the USA and a decline in Europe (for Volvo -10% compared to 2011 for heavier vehicles). AGCO expects a still solid performance of the agricultural sector and highlights a strong recovery (+38% compared to the third quarter of 2010) of the European market.
Fiat also rose by 0,37%. CEO Sergio Marchionne said that Fiat and Chrysler are on the right track to achieve their goals. Yesterday evening in a meeting with the trade unions, the manager confirmed the Fabbrica Italia plan and reiterated that the European car market will also be difficult in 2012. In Europe "we are one mile away from disaster" he specified, due to the decisions taken to deal with the crisis.
Unlike Fiat, this morning Peugeot revised downwards the 2011 objectives of its car division and announced the start of a cost cut which should lead to 800 million euros in savings in 2012. Mediaset is down -1%. Buzzi advances by 1,8%. StM drops by 1,1%. Little moves Eni +0,1% and Enel +0,3%.
Among the banks, Unicredit rises +1,1%, while Bpm falls -0,3% and Popolare dell'Emilia -0,4%. In Piazza Meda, the search for a managing director continues in place of Enzo Chiesa against whom the Bank of Italy, on the basis of the principle of stepping back asked of all the old directors, has raised the red card. The hypothesis is looming that a guarantee managing director will work alongside Chiesa, destined to remain, pro tempore, in the chair of general manager. It is unlikely that the Bank of Italy will accept this solution, even if the stalemate risks compromising the launch of the capital increase.
The supervisory board has been called for tomorrow to appoint a new management board. If times were to lengthen, it is probable that the capital increase that was due to start on 31 October would be postponed.
According to MF, the Bank of Italy, following the inspection completed this summer, would have shed a light on the product companies specialized in leasing/factoring and Ubi's consumer credit. Especially with regard to Banca 24, a Ubi subsidiary specializing in consumer credit, deficiencies in the management and control of credit risk were reportedly detected.
Geox rises by 1,8%. Among the minor titles worth noting is El.en. Cynosure, a 23% subsidiary of El.En (but wholly consolidated) closed the third quarter of 2011 with revenues growing by 48% (+36% in euro) to 28,3 million dollars thanks to the consolidation of the recent acquisitions (HOYA ConBio and SmoothShapes). By geographic area, revenues grew by 54% in North America, by 60% abroad. Ebit, excluding acquisition costs, broke even. The company generated cash for the quarter and ended up with a positive net financial position of $66 million
