Vaccine patents: Biden releases them and Big Pharma goes public

Biden's turn on the suspension of vaccine patents hits the shares of Big Pharma giants, which immediately lose ground on Wall Street - Raw materials still on the shields - Quarterly booms of Stellantis and Intesa

The Japanese price lists are galloping again after the long vacation. However, the same does not happen to the Chinese stock exchanges, which are affected by the rupture between Beijing and Australia: China has suspended the trade agreement between the two countries indefinitely after the decision by the Canberra government to cancel the participation of the State of Victoria (Melbourne) to China's Belt & Road Initiative. The diplomatic conflict risks having an impact on the prices of raw materials, which are already in great tension. But the most important geopolitical news is the American decision to grant free access to vaccine patents held by Big Pharma. "The administration strongly believes in intellectual property protections - said US Foreign Trade Minister Katherine Tai - but this is a global health crisis and the extraordinary circumstances of the pandemic require extraordinary measures". Shares of Biontech, Novavax and Moderna lost between 5 and 7%, Pfizer limited the damages to 1%. Here is the picture at the beginning of the day.

AUSTRALIA AND CHINA AT SHORTS. BAGS HOLDING DOWN

The Australian dollar falls, as do the Sydney and Shanghai stock exchanges. China's CSI 300 index is down 0,9%. Sydney's S&P ASX 200 lost 0,7%. The US dollar/Australian dollar pair rose 0,3% to 1,29.

BUT TOKYO RISES BY 1,8% AND THE DOW IS RECORD

Hong Kong is up 0,2%. Modest gains for Kospi of Seoul and BSE Sensex of Mumbai. After five holidays, the Tokyo Stock Exchange is galloping: +1,8%.

Wall Street futures are around parity. Yesterday the Dow Jones (+0,29%) set a new record, driven by Goldman Sachs and Caterpillar. The S&P 500 index is flat (+0,07%). NASDAQ -0,37%.

BEZOS SELLS AMAZON STOCKS FOR 2,5 BILLION

Jeff Bezos sold Amazon shares for $2,5 billion, his first big stock sale of 2021: the company's founder and key partner sold about $XNUMX billion in shares last year.

COMMODITY TO THE STARS, COFFEE RISES TOO (+6%)

Although oil and copper have slowed down, the race for raw materials continues, thanks to the rally in iron ore, natural gas and even coffee (+6%), the Bloomberg commodity index hits a new high since 2015.

The increase in commodities raises the expectation of cost of living: the difference between bonds linked to inflation and the others has risen to 2,84%, but the 1,584-year Treasury remains unchanged at XNUMX% for now.

VOTE FOR SCOTLAND TODAY. BANK OF ENGLAND DECIDES ON TAPERING

To follow today the meeting of the board of the Bank of England, which could decide to slow down if not suspend purchases on the market. The pound is weak this morning at 1,3910 against the dollar.

LANE (ECB): INFLATION UNDER CONTROL FOR TWO YEARS

The fear triggered by Janet Yellen's statements is now a thing of the past. After the disorderly retreat on Tuesday for fear of a change of course in the accommodating US policy, the European stock markets started to run again in the morning. Philip Lane, the chief economist of the ECB favored by Mario Draghi at the time, also took the field to hearten the Bull, who leads the dove front in Frankfurt: the Irish economist said yesterday that he does not believe that inflation can go beyond the guard levels in the next 18-24 months despite the forward flight of raw material prices or the fact that some multinationals, benefiting from the recovery in demand, are rediscovering their power to control prices. Lane stressed that the ECB forecasts an average annual inflation of just over 1% for 2022. Furthermore, for now, services, still held back by the contagion, remain suffering: 47,3 in April in Italy, below Germany also 50 points at 49,9.

REGLING (MES): THE MAASTRICHT CONSTRAINT NO LONGER MAKES SENSE

Even Klaus Regling, the German custodian of the European Stability Mechanism, expressed his opinion yesterday for the revision of at least one of the Maastricht parameters. “The limit of 3% of the deficit – he says – remains relevant. But we have to think about the limitations related to the target of a 60% public debt-to-GDP ratio, which made sense in the world where the Maastricht Treaty was negotiated, but has no reason to exist today”.

FOR MILAN (+2,03%) THE BEST SEAT IN TWO MONTHS

In the wake of these signals, Milan closed the best session of the last two months, eliminating the losses of the previous day with a rise of 2,03% to 24.463.

In the rest of Europe, Amsterdam leads the rises (+2,5%), followed by Frankfurt (+2,2%), Paris (+1,4%) and Madrid (+1,7%). Even London appreciates by 1,7%, on the eve of elections in Scotland, prologue to a possible break in the United Kingdom.

COMMODITIES PUSH THE CITY

The leap in the City is linked to the boom in raw materials: minerals, oil and even soft commodities (maize +142% in one year). The big names in the sector, from Rio Tinto to BHP Group and Anglo American, report progress of more than 4%.

SPREAD AT 108, BPPM OF EMISSIONS IN GREECE

After two sessions with plus signs, the Italian bond ends the session weakly, in a market that is digesting the arrival of new paper amid trading that remains particularly volatile.

At 17,30 Italian time, the gap between BTP and Bund rates on the 10-year segment stood at 108 points from 106 at the end of the day before. The 0,85-year rate is at 0,81% from XNUMX% at the previous closing.

In a buyback operation, the Treasury repurchased four bonds - three BTPs and one CTZ - maturing in 2021 for 4,725 billion.

Germany, which is preparing to issue a new 3,33-year green bond this month, has simultaneously placed 2026 billion euros in the April XNUMX Bobl.

Greece is very active, taking advantage of the promotion of its rating by S&P. Athens, in addition to placing 812 million in 13-week government bonds, placed via syndication a new 5-year bond for 3 billion euros on orders over 20 billion.

STELLANTIS SUPERSTAR, REVENUES +14%

Prompt recovery from the Agnelli team after a very difficult day. On the shields Stellantis (+7%), thanks also to quarterly better than estimates. Proforma revenues were up 14% to $37 billion and shipments were up 12%. The chip crisis has resulted in the loss of production of 190 cars, especially in North America. But thanks to the integration with Peugeot, which boasts a solid presence in the electric sector, the former Fiat will be able to offset the polluting credits that last year amounted to 300 million euros at home, two-thirds paid to Tesla. CFO Richard Palmer pointed out that the synergies announced on the occasion of the merger operation “can be achieved within the foreseen times. We are doing well and we are on the right track”.

CNH RAISES ESTIMATES, RECOVERS (BUT NOT TOO MUCH) FERRARI

Also to the rescue was CNH Industrial (+5,27%), which revised upwards its guidance for the current year after closing the first quarter with revenues up by 37% and an adjusted net profit of 454 million dollars from red of 66 million a year earlier.

Ferrari's recovery was only partial (+1,55%) after the slide on the eve, caused by the one-year postponement of the 2022 financial targets due to the impact of Covid-19. Some US brokers have cut the target price of the Red's shares.

KEPLER: THE USA CRAZY FOR CAMPARI (+8% IN ONE MONTH)

Campari's rally continues, +1,23% (up 8% in the last month), on the wave of analysts' promotions: Jefferies brought the target price from 10,5 to 11 euros (rating hold), citing the strong start of the year achieved by the group, while Kepler Cheuvreux raised the target price from 11 to 11,5 euros, with a buy rating. The first quarter of 2021 "was well beyond expectations and the performance of competitors", explain the analysts of Kepler Cheuvreux, who cite the trend on the US market and of all key brands except Aperol. “The outlook is positive and leads us to increase our EPS estimates by 4% in 2021 and by 2% in 2022-2023”.

Buzzi Unicem also rises: +2,76%.

INTESA BEATS FORECASTS BY 50%

Among the banks, moderate rise by Intesa, which rises by only 1,4% afterwards amazing accounts: "We are in line with the goal of a net profit of over 3,5 billion in 2021", said CEO Carlo Messina. In the first quarter, profit (1,516 billion) beat analysts' estimates by 50%.

Today Unicredit (+2,56%) is called to answer to the rivals of Ca' de Sass. Banca Generali also stood out (+2,36%), returning from the best collection month ever.