"On the razor's edge". For the Irish premier, the state of the negotiations between Brussels and London to avoid Brexit signals absolute uncertainty: the no deal exit is given 50 to 50. On the currency markets, the pound is down slightly (1,3419 against the dollar) , the euro at 1,2133, not far from the highs reached in April 2018. Thus begins a key week for the future of the Eurozone, marked by the negotiations on the Recovery Fund with Poland and Hungary and the tensions in Italy on the Mes. Even beyond the borders of the Old Continent, a note of uncertainty prevails: the markets are disturbed by the prospect of sanctions that Washington could adopt today against senior Chinese leaders in response to the repression in Hong Kong, a move not unwelcome to the Democrats.
Hong Kong's Hang Seng lost 1,7%, Shanghai's CSI 300 and Shenzen 0,7% and Tokyo's Nikkei 0,6%. Seoul's Kospi +0,2% and Sydney's S&P ASX 200 +0,5%. Overshadowed by the news of the leap in Chinese exports, which rose by 21% year on year in November. The MSCI Asia Pacific index, which excludes Japan, fell 0,2% after four consecutive days of gains. The Indian Stock Exchange rises and is very close to all-time highs, driven by an increasingly significant flow of purchases from abroad: last week net inflows rose to 17 billion dollars, a level never seen since 2013.
IN VIEW OF THE BUDGET DEAL IN WASHINGTON
Wall Street's S&P500 index future is down 0,2%. Wall Street hit new all-time highs on Friday, also due to the arrival of a new tranche of emergency aid from Congress. The Financial Times and other newspapers are reporting that a $900 billion bill will be introduced tonight by a panel of Democratic and Republican senators. The package, much smaller than what the Democrats had in mind (over 2000 trillion), but also smaller than what Joe Biden had asked for, should contain almost 300 billion dollars for small companies and 180 billion to increase the subsidy of unemployment. There would also be almost twenty billion for the airlines.
OIL HOLDS BACK, ARABIA CUT DISCOUNTS
Brent oil down 0,5% to 49 dollars a barrel. Crude oil prices at eight-month highs prompted Saudi Arabia to reduce the discounts usually granted to its large Asian customers.
ECB: MORE PEPP AND QE IN SIGHT
The markets are concentrated on the performance of the euro/dollar cross; since January, the single currency has gained 8% against the dollar, a trend that has been accelerating in recent sessions: the euro, after crossing the 1,2 threshold, promises to move towards 1,25 (Goldman Sachs forecast) . But the trend will depend on the decisions of the next directorate of the ECB, scheduled for Thursday 10, in which the president Christine Lagarde will announce the measures to relaunch the Eurozone economy in slowdown. Operators are certain of some interventions: the duration and size of the Pepp (500 billion more, extended until the end of 2021), a strengthening of the Qe and the auctions for Tltro loans.
High voltage too the domestic confrontation on the Mes, yet another chapter of the confrontation for or against Brussels in Italian politics. Prime Minister Conte takes it for granted that in the end an agreement will be found that avoids the threatened rupture at the top of the government. Today the Council of Ministers should launch the committee that will be responsible for choosing the programs to apply for European funds: a task force with six super managers to define the resources to be put in place for each of the six identified macro-areas. But last night there was a sharp stop from Italia Viva, Matteo Renzi's party.
MORGAN STANLEY AWARDS OTALIA
Markus Guetschow, economist at Morgan Stanley, reasoned on the future of Italy yesterday in a focus dedicated to Italy in the context of the American bank's Outlook for 2021. Guetschow points out that, after -18% of GDP in the first half, the strong rebound in the third quarter was driven precisely by the industrial sector, which reached the levels of February during the summer. “Despite the ongoing contraction in the last three months of the year, this upside surprise leads us to revise our 2020 growth forecast to -8,8% y/y, above our mid-year estimate which saw a decline of 12,4% y/y”.
The Eurogroup meeting dedicated to the approval of the Recovery Fund will be held on Thursday and Friday with the ratification of the objectives set by the program for the fight against Climate Change. At the center of the confrontation is the refusal of Poland and Hungary to sign the clauses that guarantee some fundamental freedoms (the independence of the judiciary, for example).
Today the OECD will present the world pension observatory. Analysts are also looking at the rise in T Bonds (0,97-year at XNUMX%), showing a strong recovery despite the difficulties of the US labor market.
TESLA DOES NOT DISTRIBUTE THE UNDERWEAR PROMISED TO MEMBERS
In the US, he notes with amusement Financial Times, many investors are ready to sue Elon Musk, who in March had promised the new partners a pair of underpants, that is the only dress that, according to Cassandre, would be left to the Tesla partners who, on the contrary, got rich. But they have not received the promised underpants so far.
Great expectations for the shareholders' meeting of Walt Disney, engaged in a complex change of course: the theme parks closed, the cinemas stopped, the entertainment giant focused on streaming. Also to be followed is the meeting of Facebook's shareholders: several states are preparing to sue the social network for violating antitrust legislation.
In Piazza Affari to follow Stm, promoted on Friday by Moody's, which raised its outlook to "positive", confirming a "Baa3" rating on the Italian-French chip manufacturer.
