The sword of Damocles of inflation hangs ever more menacingly over the fate of European finance grappling with high energy prices which are however infecting other spending sectors. The price index in the 19 eurozone countries jumped to 8,1% in May, up from 7,4% in April, thus fueling tensions over the now inevitable rate hike, which the governor Ignazio Visco. “The increase – he said – will have to proceed gradually given the uncertainty of the economic prospects”.
This is the thesis of the president of the ECB Christine Lagarde and of the chief economist Philip Lane who proposes an increase of 25 points (plus a second in September). Other bankers are calling for quicker and more robust interventions. The central bank governors of Austria, the Netherlands and Latvia voted in favor of a 50 basis point rate hike in July.
Stocks Ko due to record inflation
In this context, the price lists of the Old Continent retreat: Milan loses its hit -0.68%, the other main squares do worse. Only the London Stock Exchange rose, FTSE100 +0,20%, supported by the big names in basic materials.
The surge in oil contributes to pushing prices up, returning to the levels of early March at 124 dollars in the Brent version. European natural gas rises by 3% to 92,50 euros. Gazprom has announced that it has completely cut off gas supplies to the Dutch GasTerra, which refused to pay in rubles for the gas delivered in April in rubles.
Government bond yields are on the rise. The ten-year Italian rises to 3,08%. In this morning's auctions, rates rose to the highest since November 2018. The third tranche of the December 2032 BTP was assigned for 2,5 billion euros with a gross yield of 3,10% compared to 2,78% at the end of April. The 5-year BTP was placed at a rate of 2,16% (compared to 1,91% last month). The Treasury also allocated 1,25 billion Ccteu on October 15, 2030, at the rate of 0,87%.
The cost of money is also under tension in the USA. The yield of T-note rises to 2,83%, ten basis points higher than the day before. The US central bank must continue to hike interest rates until inflation starts to fall, Federal Reserve Governor Christopher Waller said on Monday in favor of more half-point rate hikes “over several meetings” .
Nasdaq futures lost 0,4% before the release of data on house prices collected in March in the main metropolitan areas of the country. open market, at 16 pm, the consumer confidence index comes outi by Conference Board: the consensus expected a drop to 103,8 from 107,3 in April. At 16.30 the Dallas Fed index comes out.
Bags Ko but Tim does not stop the race
Continue to Piazza Affari the Telecom Italia show, at 13 to +3,4% after having exceeded even 5% in the morning. Observers go so far as to hypothesize the possible outcomes of the negotiation which, among other things (or above all) will make it possible to reduce the debts of the former incumbent. According to Bloomberg Tim aims to collect around 20 billion for NetCo from Open Fiber. The inclusion of the backbone (transport network, backbones) in the perimeter of the NetCo is uncertain: Tim would aim to have a competitive advantage by keeping it in the ServCo (TIM's main competitors are infrastructured with backbones), while CDP would also be interested in taking over the backbone. At the helm of the single network will be Mario Rossetti, man of CDP and current CEO of Open Fiber. The proceeds from the sale of NetCo do not exclude the distribution of an extraordinary dividend to shareholders, starting with Vivendi which will not participate in the single network.
Of note among the oil companies is the rise of Eni +1,2% but also the excellent performance of Saras +5% on the wave of gains from refined products. In shipping D'Amico takes off +9.03%: the EU summit has not banned the transport of Russian crude oil.
Among the most sacrificed titles Ferraris -2,98%, Citi has cut the target proce from 160 to 140 euros.
Generali -0,4% will exercise the early repayment option on all outstanding subordinated debt securities maturing in July 2042. The repayment will take place on 10 July. In the meantime, the Milan Public Prosecutor's Office has launched an investigation into the hypothetical crimes of defamation and market manipulation following a complaint from the company's board of directors presented after interviews with Francesco Caltagirone and Luciano Cirinnà.
Unicredit +0,6%, could obtain a downward adjustment of the prudential requirements set by the Basel Committee, Bloomberg reported this morning. The provision should contain a revision of the capital criteria of European systemically important banks present in several countries.
Enel falls -1,4% after Barclays lowered the target price to 9,2 euros.
Tinexta+7%, announced on Monday evening that it had sold the Credit Information & Management division to Crif for 237,5 million. The resources collected will allow an acceleration towards the achievement of the objectives of the business plan.
