While waiting for the Israeli army's land offensive, the United States' diplomatic offensive is underway. The Secretary of State has been in the Middle East for several days now, engaged in visits and consultations especially with the Arab and Islamic world. President Biden himself could arrive in Israel within a few days. Meanwhile, thebiblical exodus: six hundred thousand people, mostly residents of Gaza, left the city to move to the southern part of the strip.
This war bulletin encourages escape from risk but for now it does not translate into panic: The Wti oil it trades at 87,5 dollars a barrel, unchanged after Friday's jump, +5,7%, best session since April. Gold is down 0,5% to 1.920 dollars per ounce, +3,5% on Friday is the largest daily variation since December 2022. The positive start last Friday contributes to the stability of the markets from the US quarterly. But for once some good news arrives from the geopolitical front: the pro-European Donald Tusk, with 31% of the votes, is the real winner of the elections in Poland. Thanks to alliances on the left, he will be able to form the government and oust the sovereignist Kazscinky from the government, a result that will weigh on Brussels' next choices. Maybe already starting from the Eurogroup scheduled for the evening.
- European stock markets opened moderately higher but then turned negative. Piazza Affari -0,13% to 28.200 points.
- On Friday the Ftse Mib closed down by 0,9%, +1,5% for the week. The positive data can be explained by the results of banks and energy. Luxury is bad, with losses of around -5% for Moncler, -3% Tod's, -2,5% Ferragamo.
In Italy: the economic maneuver begins, waiting for S&P
Today Italy will release data oninflation for the month of September. But the spotlight is focused on cabinet who will face the Maneuver for 2024 and the budget plan to be sent to Brussels. Much is known about the budget which will be around 25 billion and whose main feature is the confirmation of the cut in the contribution wedge for workers with an income of up to 35 thousand euros, with a merger of the first two Irpef rates. Moves, both valid only for next year.
While awaiting confirmation of these interventions, investors are looking above all to the end of the week: S&P's opinion on Italy is expected on Friday. In April the agency maintained the BBB classification with a stable outlook on Italian debt, two steps above the junk level, applauding the prudent approach chosen by the government. S&P inaugurates the weeks of report cards which will culminate with Moody's on November 17th, which is the most difficult because its rating is only one step above the speculative level, with a negative outlook.
Kkr values the Tim network at 24 billion
KKR's offer on the Tim network is also being examined by the markets: for 100% of the network company (Netco) it would be 21 billion which rises to 23 including the synergies of a future merger with Open Fiber. At a later stage the Mef will take over a share of between 15 and 20% for 2,5 billion. After an initial surge, Tim shares lost 1,57% to 0,27 euros at 9,30 am.
BTPs recovering, the spread still above 200 points
The rush for safety favored bonds: ten-year Bund +1,2% in the week with a yield dropped to 2,74%. Ten-year BTP +1,4% in the week, the first positive after six declines, with the yield falling to 4,76%. Spread just above 200.
Today at 11 am the trade balance of the euro zone is released.
Plus sign on Wall Street waiting for Tesla
- Futures signal a positive opening for Wall Street indices.
- Results from JP Morgan Wells Fargo and Citigroup showed on Friday that high interest rates are inflating banks' profits. This week, in addition to other large banks, such as Goldman Sachs, the quarterly data of some big names in tech and industry are released.
- The accounts of Tesla but also of other sector leaders are in the spotlight: Procter & Gamble, Johnson & Johnson, Netflix.
Tension on rates, Powell speaks on Thursday
- On a macro level the event of the week will be the speech of Fed Chair Jerome Powell scheduled for Thursday, before the speech ban kicks in ahead of next week's rates meeting.
- The dollar opens with a slight strengthening, stimulated by the search for refuge. On the macro front, the latest indicators emerging from the US economy theoretically point to a decline in the dollar: the University of Michigan's consumer confidence index fell more than expected in October to 63 points, from 68 in September, the consensus he expected 67.
- Ten-year Treasury +0,80% in five sessions, first positive week after five downwards.
53% of Japanese debt is in the hands of the BoJ
- In Asia Pacific the week opens in red.
- Tokyo Nikkei -1,9%. Bond purchases by the central bank of Japan in the last ten years have exceeded one million billion yen, precisely, as of yesterday, they were 1.010 billion. It was the central bank itself that communicated the amount. 53% of Japan's public debt is in the hands of the central bank.
- CSI 300 of the Shanghai and Shenzen stock exchanges -0,7%. Hong Kong Hang Seng -0,4%. The central bank of China injected 289 billion yuan into the financial system, just under forty billion dollars, the largest liquidity intervention since December 2020.
- Taiwan Taiex -1%. Kospi of Seoul -1,2%. Mumbai BSE Sensex -0,2
Oil: flat opening
- Flat opening for oil: Brent above 90 dollars WTI at 87,7. Investors are trying to understand the impact of the Hamas/Israel conflict. The conflict has had a minimal effect on supplies, but an escalation of tensions, with the involvement of Iran and Hezbollah could send the price of Brent crude up to $100.
- EU Natural Gas (Amsterdam) closed the week at 54 euro/mwh, the highest since August. Worker unions in Australia have renewed calls to start strikes at Chevron's LNG plant, threatening a disruption to global supplies.
The KKR offer faces the market, Ferrari accepts bitcoin
In addition to the Tim case there are, like every Monday, revisions of the targets for various stocks:
- Leonardo Morgan Stanley raises the target price to 15,2 euros.
- Prysmian JP Morgan raises the target price to 49 euros.
- stm Citi lowers the target price to 67 euros.
Mediobanca: proxy adviser Glass Lewis recommends voting for the list presented by the outgoing Board of Directors for the renewal of the Mediobanca board at the next meeting on 28 October. “While we recognize the competence and background of all the candidates presented, we believe that shareholders can reasonably support the slate presented by the Board of Directors,” the report reads. In addition to the list of the outgoing Board of Directors which proposes the confirmation of the CEO Alberto Nagel and the president Renato Pagliaro, two other lists were presented by the shareholder Delfin with five candidates and by a group of funds under the umbrella of Assogestioni.
Ferrari: has started accepting cryptocurrency payments for its luxury sports cars in the United States and will extend the system to Europe following requests from its wealthier customers, its marketing and sales manager told Reuters.
