The oil fever seems to be subsiding, for now, in the hope that OPEC+ will increase supply next week. And so, after a nightmarish session, the stock lists recover, at least judging by the futures. But T-Bond yields above 1,55% hang like a guillotine on the fate of the Bull. And it will be like this at least until Friday, when the data on US consumer prices are released: in the event of a sharp increase, the graphic designers warn, the Nasdaq could plummet below 4,300 points (yesterday 4.352) giving way to new declines.
US DEBT, DRY TREASURY ON OCTOBER 18
Here is the picture of the market in a delicate moment. In the US, the Republican veto weighs heavily on the increase in the debt ceiling, which, warns the head of the Treasury, Janet Yellen, will trigger the default of the federal administration on 18 October. Meanwhile, the president of the Fed, Jerome Powell, ends up in the crosshairs of the democratic left: "he IS a dangerous man", says the influential senator Elisabeth Warren. The strength of numbers remains to support the markets: according to Data Trek, prices do not reflect the strength of the results of the Corporations. A meager consolidation at the end of the blackest meeting on the eve of October, a bad month for wallets.
NIKKEI IN RED, EVERGRANDE MONEY
Asia Pacific stocks are all down, following the Nasdaq's worst session in six months. But Wall Street futures are up this morning and bonds also appear to be in check.
The Bloomberg Apac index is down 1,7%. Tokyo's Nikkei -2,5% on the day of the choice of the new prime minister after Suga's resignation.
Hong Kong's Hang Seng dropped 0,5%. Evergrande is up 10%, to 2,94 Hong Kong dollars, the third consecutive day of strong appreciation after selling the stake in Shengjing Bank, an operation that should bring it 10,3 billion yuan in cash. The next deadline with the creditors is today: Evergrande has to pay 47 million dollars in interest to the subscribers of its dollar bond. But the line followed so far is to repay debts with Chinese savers only.
The CSI 300 index of the Shanghai and Shenzen lists fell (-1,5%), as did the Kospi of Seoul (-1,6%). BSE Sensex of Mumbai -0,5%.
US MARKETS, NEVER SO BAD FOR 6 MONTHS
Nasdaq futures are up 0,5% after losing 2,8% yesterday. The technology giants, from Microsoft to Amazon, are targeted, with losses between 2% and 3,6%. Ford, on the other hand, rose (+1,1%) after the agreement on the electric car with the Korean company SK.
In the post stock market, Micron lost 3%. The chip company presented lower-than-expected quarterly figures for both earnings and sales.
CRUDE OIL DOWN TO 78 DOLLARS
The 1,53-year Treasury Note is yielding 1.739% this morning. Gold slightly up to 0,9 dollars, from XNUMX% yesterday.
Oil under braking. WTI trades at 74,3 dollars a barrel, down 1,3%. Brent at 78,06 dollars a barrel (-1,3%).
OPEC: INVEST MORE THE IEA: IT'S TIME TO CUT
The surge in oil causes a difference of opinion between the producing countries (OPEC) and the International Energy Agency which represents the position of the OECD.
Oil demand, OPEC argues, will grow significantly in the coming years, with the global economy recovering from the pandemic so the world needs to continue investing in production to avoid a crisis pending the energy transition. The cartel's view contrasts with that of the IEA which, in its May report, argued that investors should not finance new oil projects if the world is to reach net-zero emissions. “Energy and oil demand recovered significantly in 2021 after massive declines in 2020,” OPEC Secretary-General Mohammad Barkindo wrote in the foreword to the report. Therefore, “A continuation of the expansion is expected in the long term”.
Oil consumption will increase by 1,7 million barrels per day in 2023 to 101,6 million, according to the World Oil Outlook 2021 by OPEC, an expansion that will add to the robust growth already forecast for 2021 and 2022.
THE ENERGY CRUNCH SCARES EUROPE TOO
A day of passion also for Europe. The rises in gas and oil prices do not stop. And investors fear that the energy crunch could affect other sectors of the economy as well. Hence the slowdown in the lists, despite the fact that the Gfk index on German consumer confidence rose by 0,3 points, recovering from the -1,1 points of the previous month: the consensus was -1,6 points. The component linked to income expectations significantly improved, while the increase in the propensity to purchase component was less marked.
Meanwhile, the president of the European Central Bank, Christine Lagarde, continues to reduce inflation fears: “The key challenge is to ensure that we do not overreact to supply-side problems that will not have repercussions in the medium term, and at the same time the positive forces of demand that could drive inflation towards our 2% target in a lasting way”.
In the meantime, the purchases of both Qe and the Pepp program are accelerating: 26,420 billion euros in the week (against 21,544).
BTP YIELDS RUN, SPREAD TO 106
However, the upward wave of prices is being felt on the bond markets in line with the tensions in the US markets: the 1,52-year T-bond had risen to XNUMX% in the afternoon.
The BTPs show a marked decline with the yield on the 0,90-year reference going as far as a hair's breadth from the 0,19% threshold, the highest since the end of June. The Bund of similar duration trades at -XNUMX%.
At the same time, the yield differential with the German counterpart widened to its highest level since the beginning of the month at 106 basis points from 101 at the start of the session.
BUSINESS CENTER -2,14%, TECHNOLOGISTS -5%
Piazza Affari suffers: -2,14%, down to 25.573 points. The other European price lists are also slowing down. Frankfurt loses 2,11%, Paris 2,17%, Amsterdam -1,9%, Madrid -2,6%. Limit damage London, -0,51%.
The Eurostoxx index loses 2,4%. Weak pharmaceuticals, -0,7%. They hold energy well (+1%).
Tech stocks in particular are under fire, the hardest hit by the prospect of a rate hike. The sector index leaves just under 5 percent on the ground, at its lowest for the month.
Logitech, the Swiss company that makes computer peripherals is down 7,25% after Morgan Stanley downgraded the stock to "underweight".
Dutch semiconductor equipment supplier Asml International fell 7,21% despite increased guidance for the third quarter.
SUFFERING BACK TO LUXURY: HERMES -4%
The decline in China's GDP estimates by Goldman Sachs has had an effect on luxury stocks: Lvmh leaves 3% on the ground, Hermès 4%.
ENI AT HIGHEST SINCE 2010, UTILITIES HOLD ON
In Piazza Affari, Eni's star shines (+0,7%), on new highs since February 2020. Goldman Sachs has strengthened the Buy, bringing the target to 15 euros. It has started construction work on the gas treatment plant that will be extracted from the Argo and Cassiopea fields.
The other oil companies also saved: Saipem contained the decline at -0,14%, Tenaris -0,47%. Maire Tecnimont +0,89% following the agreement with Greenfield Nitrogen for a green ammonia plant in the USA announced in the morning.
The utilities also avoided rejection, in particular Snam (-0,77%) and A2a (-1,2%), supported by the boom in energy prices.
STM AND NEXI UNDER FIRE, HOLDING BACK THE BANKS
Technological stocks, the ones most penalized by the collapse of the lists, are down sharply. Stm loses 5% and Nexi 4,12%.
Banks were weak, with the exception of Bper (+1%). Intesa Sanpaolo and Unicredit lose 1,2% and 2,3% respectively.
DEL VECCHIO IN PRESSING ON MEDIOBANCA
Mediobanca. Leonardo Del Vecchio's Delfin asked to integrate the agenda of the meeting of 28 October by proposing to "eliminate the statutory requirement according to which three directors (in the event that the board has more than thirteen members) must be managers of the group for at least three years" and "also to increase the number of minority directors, with the provision that more lists can contribute to the appointment of these directors", explains a note.
CATTOLICA STILL ABOVE THE BID PRICE
Cattolica Assicurazioni holds: -0,14%, at 7,15 euros, well above the price of the takeover bid (5,75) that Generali will launch next month, considered fair by the board of directors. Difficult to raise: the operation is not appreciated by the couple Caltagirone-Del Vecchio.
Realize on Amplifon after the recent rally. Interpump also lost ground (-3,89%).
DANIELI RUNS, DOWN ACROBATIC BUILDING DESPITE THE BUYS
Danieli shares are ripping (+9%) after the results of the 2020-21 financial statements as of June 30, well above market expectations and the positive prospects for the steel sector this year and next. “Overall we raise the expected Ebitda for 2022-23 by 10%/8% and net profit by 18% and 14%”, writes Equita. Sull'Aim loses ground Edilizia Acrobatica (-2,3%), despite the fact that the half-yearly accounts show a doubling of the value of production. Intesa Sanpaolo reaffirmed the buy rating.
