The first part of the rally, the easiest and mostly emotional one after the announcement of the Iran-US agreement, is calming down: the next phase requires confirmations, not only on the holding of the ceasefire, but also on the possibility that oil flows through Hormuz can actually normalize without a hitch. The framework agreement, which is expected to be formally signed in Switzerland Friday, does not address key issues such as the Tehran's nuclear program and the conflict between Israel and Lebanon. Oil prices remain above $80 a barrel, and shipowners say it could take weeks to rebuild the confidence needed to navigate the Strait safely. Yesterday, however, Wall Street shone with a Nasdaq at +3%. Asia was dominated by central bank moves today. Japan and Australia, while they worry about the Chinese consumption, which have fallen to their lowest levels since the pandemic. European stock exchanges are seen opening in
Wall Street closed strongly yesterday, led by the Nasdaq (+3). Nvidia is seeking $25 billion in market financing.
Yesterday, Wall Street saw a powerful rally, but tech stocks once again prevailed, leading the Nasdaq to close up 3% and the semiconductor sector to close up 5,5%. The Dow Jones Industrial Average nevertheless posted a record close, up 0,92%, and the S&P 500 up 1,65%. This was all thanks to the euphoria following the announcement of the preliminary agreement between the US and Iran, which also eased fears of rising inflation and monetary tightening.
The resulting sharp drop in oil prices (-4,9%) benefited stocks in airline companies with United Airlines which recorded a rise of 3,9% and cruise companies including Norwegian Cruise Line (+ 3,7%) and Carnival Corp. (+3,2%)., sensitive to energy prices, while it penalized energy sector stocks. On the other hand, energy sector stocks Fox fell 16,8% after the company announced its intention to acquire Roku in a $22 billion deal. Shares of Roku fell by 1,9%.
A strong boost came from the chip giant Nvidia which increased by 3,5%, and Micron which jumped 10,5% after at least two brokerage firms sharply raised their price targets for the stock. Nvidia has shocked the debt market with abond issue surprisingly large from 25 billion dollars, which he says he will use for refinancing and general purposes.
SpaceX rose 19,6% on its second day of trading, after the sensational IPO of the company led by Elon Musk pushed its market capitalization above $2 trillion. The stock closed yesterday at $192,46, compared to its IPO price of $135. In after-hours trading, its market capitalization surpassed $2,6 trillion, with the stock up about 48% from its listing price.
In addition to the Iran deal, another key topic for investors is the upcoming update of monetary policy of the Fed, scheduled for tomorrow, after the president's first monetary policy meeting Kevin Warsh since taking office following Jerome Powell last month. The meeting follows May's inflation data, which showed how rising energy costs have impacted consumer prices. According to CME Group's FedWatch, market participants expect the Federal Reserve to leave interest rates unchanged this week, but continue to price in a nearly 42% chance of a 25 basis point increase by the end of the year. (Opens a new tab).
Asia: Japan raises interest rates. In China, consumption collapses to its lowest level since Covid. Eyes on Kospi's defense stocks.
Le asian bags they recorded cautious earnings, after the rally of the previous session as investors weigh the rate decisions of interest to the Bank of Japan and Reserve Bank of Australia. The central banks' moves went as expected: the Japan raised the short-term interest rate at 1%, the highest level since 1995, and Australia left rates unchanged at 4,35%. Neither yen nor the dollar Australians showed marked initial reactions.
Attention now shifts to the press conferences in Sydney and Tokyo, where investors expect a rather dovish outlook, having already priced in a further rate hike in Japan this year and a 65% chance of a further hike in Australia. The rate hike in Japan brought rates to the minimum level estimated by policymakers for the economy's neutral rate, but it came with a pre-announced pause in the central bank's withdrawal from the bond market: it will reduce bond purchases by around 200 billion yen ($1,25 billion) per quarter until April 2027, when it will stabilize purchases of Japanese government bonds (JGBs) at around 2 trillion yen per month. The Japanese government bond index Nikkei 225 rises 0,5% briefly surpassing share 70.000 to reach an all-time high. The shares of Softbank remained stable after that Reuters reported that the chief financial officer of the Vision Fund, the group's investment arm, will leave his position after a decade.
The Australian index The ASX 200 is hovering near parity, weighed down by weakness in local mining and banking stocks.
In China, May data showed that the consumer spending has contracted for the first time since the beginning of the pandemic, while the investments have worsened, highlighting the risks the economy still faces, despite the export boom. Even the house prices in the country decreased at a faster pace in May. industrial production Instead, it offered a positive note, growing slightly above expectations thanks to strong demand from abroad. However, the data weighed on market sentiment, with the Hang Seng Index Hong Kong which lost more than 1% also due to strong selling in local internet and technology stocks. The Shanghai Shenzhen CSI 300 and Shanghai Composite indices were virtually unchanged.
In South Korea the index Kospi advanced 2% thanks to continued gains in technology stocks and semiconductor manufacturers, following Wall Street. South Korean defense sector are rising. Hanwha Aerospace, Seoul's leading defense stock, rose as much as 11,8%. Hyundai Rotem, maker of the K2 Black Panther main battle tank, gained as much as 12,67%, while LIG Defense & Aerospace nearly hit the 30% upside limit on the Kospi index. Firstec, which produces components for ground combat vehicles, also nearly reached its 30% upside limit. Investors expect defense exports to resume soon and orders from the region to increase, Mirae Asset Securities wrote in a June 16 note. Kang Tae Ho, an analyst at South Korean brokerage firm DS Investment and Securities, also said that the end of the war in Iran would act as a "positive catalyst" for the Korean defense industry.
The prices of Petroleum, which closed the previous day at three-month lows, show futures on Brent down 0,3% to $82,96 a barrel. The yield on US Treasury securities The 10-year bond rose 0,8 basis points to 4,475%. gained 0,4%, reaching $4.324,32 an ounce. In the cryptocurrency markets, the bitcoin lost 1%, settling at $65.799,61, while the ether fell 2,9% to $1.762,15.
European stock markets saw a break-even opening. At the Milan Stock Exchange, eyes are on Avio and Intesa Sanpaolo.
European stock markets are expected to open around the Euro Stoxx 50 Futures -0,1%.
Avio could be affected by the performance of Space X shares yesterday, which closed up 20%.
Bpm bankAccording to press reports, at today's meeting, the Board of Directors will discuss the details of a potential agreement with Banca Monte Paschi.
Intesa San Paolo. The company has committed to consult with the government on future decisions regarding Generali, as part of the guarantees on the acquisition plan of Banca MPS, according to two sources close to the matter interviewed by Reuters.
StM announced a two-tranche issuance of new convertible bonds worth $1,5 billion and the early redemption of its convertible bonds due 2027, worth $750 million.
UniCredit. Subscriptions in the Commerzbank public offering rose to 11,91% yesterday, up from 11,86% on Friday. The direct share rose to 38,68%, while physically settled derivatives accounted for 41,9%, and cash-settled derivatives accounted for 55,09%.
Rai Way. Regarding the merger agreement with EI Towers, the memorandum of understanding expired yesterday at midnight: neither an agreement nor an extension are among the options, but negotiations are continuing; F2i is pushing for the conclusion of the agreement.
