BTP YIELDS AT 6,06%, SPREAD AT 384 POINTS
MERKEL, CRISIS WILL NOT BE RESOLVED IN ONE YEAR
Tensions on Italy risk with Btp yields over 6% and the prospect of huge recapitalizations for banks put Milan back in the red after yesterday's euphoria: the Ftse Mib lost 1,78% to 16.653,55 points, after coming to lose more than 2%. But today, albeit with smaller losses, all the European stock exchanges are moving in negative territory under the uncertainties of the details and the concrete implementation of the euro-saving plan. The lists trim the losses in the final and close overall weak: the Cac drops by 0,51%, the Ftse 100 by 0,35% while the Dax recovers the plus sign and closes up by 0,10%.
Wall Street opens slightly down and now moves in contrast: the Dow Jones rises by 0,16% while the Nasdaq retreats by 0,10 after Samsug overtook Apple in quarterly smartphone sales. Chancellor Angela Merkel is once again lapidary: "The sovereign debt crisis in the Eurozone will not be resolved in the space of a year - she said - The eurozone is facing a crisis of confidence that will not go away in a day or in a year with a simple swipe of the sponge”. Also from Germany, the Constitutional Court blocks the way to save the Eurozone in a short time. In fact, it suspended, until the final sentence, the establishment of a special parliamentary subcommittee which had recently been envisaged by a provision of the Bundestag, the German parliament, to simplify the decision-making processes on anti-crisis measures at European level in the future and contested by some MPs.
Parliament's decision-making rights, the Court notes, cannot be taken by a special commission made up of only 9 parliamentarians. From China, where the director of the EFSF fund is visiting, there are signs of caution regarding the timing and methods of Asian support for the fund. While the clash over easy layoffs continues and Berlin asks Rome to resolutely carry out the announced actions, investors are showing signs of concern about Italy's ability to meet its commitments. Indeed, today's BTP auction saw yields rise to 6,06%, the record since the creation of the euro. In detail: the fifth tranche of the ten-year March 2022 was placed for 2,98 billion compared to a range between 2 and 3 billion with a yield of just over 6% compared to 5,86% at the end of September and a bid to cover (the ratio between supply and demand) down to 1,27 from 1,374.
The Treasury then placed 3,084 billion of the BTP in July 2014 compared to a range between 2,25 and 3,25 billion with a yield on the maximum since November 2000 of 4,93% from 4,68% at the end of September and a bid to coever to 1,324 from 1,365. Two out-of-issue securities were then placed: the CCTeu of October 2017 was placed at 5,59% for one billion euros on an offer of between 500 million and 1 billion; the BTP in September 2019 was assigned for 871 million with a yield of 5,81%. The spread between 384-year BTPs and the German bund rises to XNUMX basis points.
MICHIGAN CONSUMPTION INDEX IMPROVES
BAD CONFIDENCE IN EUROPE
The improvement in the October consumer confidence index measured by the University of Michigan, which rose to 60,9 points from 59,4, did not help to ease the pressure either. Is the risk of a double dip recession receding? The perception of the situation in Europe in Europe is quite different: the Bank of Italy communicated that in October the Euro-coin indicator, which provides an estimate of the underlying dynamics of the GDP of the Euro area, reached for the first time since September 2009, a negative value, equal to -0,13% (against 0,03 in September). The decline is the result of the worsening of most of the variables that contribute to the calculation of the indicator, especially the climate of business and consumer confidence. At the close of the European markets, the euro traded down against the dollar in the 1,417 area. Oil traces slightly around 93,4 dollars a barrel.
BANKS, WEIGHING THE RECAPITALIZATION BILL
IT'S A CREDIT CRUNCH EMERGENCY
In addition to the tensions on spreads, weighing on Milan since the start of the session are also the data released by the EBA which asks the banks of peripheral countries to make the greatest efforts: Out of the 106 billion capital required after the haircut on the additional Greek debt calculated by the EBA as many as 79 will be paid by the shareholders of the so-called European periphery: 30 for Greece, 26,2 for Spain, 14 7 for Italy. France will have to recapitalize its banks for 8,8 billion, Portugal for 4,8. Even less is required of Germany, 5,2 billion.
Here is that Banco Popolare, which according to the EBA will have to recapitalize for 2,817 billion, sells 6,41% and Mps, which must put in 1,5 billion, 4,81%%. Unicredit is also bad (-4,36%%) which according to the EBA will have to recapitalize for 7 billion (practically half of what is required of the 38 largest Italian banks). Intesa Sanpaolo was also weak (-5%), the only one to have capital deemed "adequate". Thus the fear returns that the new specter to be fought is a worsening of the credit crunch for businesses triggered by the need for banks to recapitalize, which means either to obtain fresh resources, an increasingly difficult option after the round of recapitalizations just carried out by institutions and light of market conditions, or reduce outlays. For Bankitalia, the objectives must be achieved by avoiding excessive deleveraging, in order to contain any negative impact on the real economy. The way is to limit the distribution of dividends and bonuses
RISE CONDITIONS WEIGHT ON BPM
MEDIOBANCA, PROFIT HALF
But the events of the Bpm are also dragging the index downwards which, as the worst stock in the main basket, drops 9,57%%: the institute has in fact communicated the conditions of the capital increase which starts on Monday and which envisage a 40% discount on Terp (and not 30% as previously thought) at 0,3 euro per share for a total amount of 800 million. "If there is a takeover" from the capital increase, "it will be managed intelligently, avoiding capital losses and respecting the autonomy" of the Piazza Meda institute - said Alberto Nagel CEO of Mediobanca, leader of the guarantee consortium for the increase – It would never be used for any other purpose, it's not our style. All the hypotheses heard to date are fantasies, such as that we called the investors”. Which, however, he added, "make it less easy to take on than if they weren't there at all".
Bper also fell sharply (-6,98%) which yesterday published the notices relating to the public exchange offer on the minorities of the subsidiaries as part of the group's reorganization process. Mediobanca also fell (-1,23%) after quarterly results with a profit down to 56,8 million from 127,6 a year earlier.
FIAT COLLAPSES BUT SAVINGS AND PRIVILEGED FLYWHEEL
EDISON DOWN AFTER ACCOUNTS
Fiat then fell, marking a drop of 4,98% in the aftermath of results judged by shadowy operators and the announcement of the conversion of privileged and savings bonds into ordinary ones. Today the CEO Sergio Marchionne confirmed the distribution of the dividend for the 2011 financial year. Savings fly up by 19,35% and privileged by 17,06%. Fiat Industrial regains its share, closing up 0,66% (among the best of the Ftse Mib) after a session under pressure despite the accounts that highlighted profits almost doubled to 204 million euros. The savings and privileged ones skyrocket by 34,04% and 36,09% respectively. Meanwhile, the Chinese score another coup in Europe with the purchase of Saab for 100 million euros. Meanwhile, Moody's has raised the ratings of Ford and GM.
Edison sells 4,71% after releasing the accounts and following the agreement between the shareholders which will give control to the French: in the first nine months of 2009 the multi-utility's revenues rise by 13,1% to 8,591 billion in first nine months of 2011 but the gross operating margin (Ebitda) fell by 22,9% to 717 million. Against a pre-tax profit of 4 million euros, the group records a net loss of 93 million.
The Robin Hood tax weighs in at 23 million. Net financial debt also rose at September 30: 4,104 billion euros from 3.708 million at the end of December 2010. Edison, however, confirms its Ebitda estimates for the current year at 900 million euros. In contrast, Tenaris closed up 2,44% and Autogrill +1,21%. Campari (+0,7%) and Tod's (0,61%) were also among the best.
