Theresa May's defeat, overwhelmed by vote on the Brexit plan, did not surprise the financial markets, except for its size: 432 against, 202 in favor, the worst result for a government since 1924. The pound is unchanged, both against the dollar and against the euro, on the highs of the last month and a half. Fear indicators, like gold, do not move: even in the last few hours they have remained almost stationary. There is only a modest appreciation of the yen.
NEW LIQUIDITY COMING TO CHINESE SQUARES
All things considered, the echo on Asian markets was modest, obscured by China's efforts to counter the fall in price lists and confidence. The Central Bank has introduced a new injection of liquidity. But the Chinese efforts were frustrated by a statement from the US by Robert Lightizer, in charge of the talks on duties: "For now - he said - I don't see substantial progress in the negotiations".
As a result, Asian markets moved little. The Stock Exchanges of Japan and China are down slightly, in the order of 0,1%, while those of India and South Korea are up slightly.
NETFLIX BOOM DRAG WALL STREET
Last night Wall Street closed in positive ground: Dow Jones +0,65%, S&P 500 +1,07%, Nasdaq +1,71%. Netflix's boom (+6,5% after the announcement of a price increase in the US) and the rebound of other tech stocks offset the disappointments coming from the banks' quarterly results. JP Morgan closed up 0,7% despite negative data on trading and bonds. Wells Fargo falls (-1,5%).
Brent oil was unchanged this morning at 60,6 dollars a barrel, while yesterday evening it closed up 2,8%, in anticipation of a recovery in Chinese consumption. Government data on weekly US crude inventories will be released today.
TODAY THE MOTION OF NO CONFIDENCE IN THERESA MAY
Now attention has shifted to the motion of no confidence in the Premier requested by Labor leader Jeremy Corbyn. Even if many Tories voted against the Brexit deal, it is unlikely that they intend to go to new elections endorsing Corbyn's motion. If May gains confidence, a plan B will emerge: the EU could grant an extension of three to nine months for the exit, exceeding the March 29 deadline. A new referendum, moreover with an uncertain outcome, is not excluded.
MEA CULPA BY JUNCKER. DRAGHI PROMISE NEW STIMULI
While waiting for the outcome of the Brexit confrontation, the "mea culpa" of President Jean-Claude Juncker on the treatment reserved for Greece (and Portugal) at the most delicate moment of the crisis caused a sensation yesterday.
The Draghi put remains to support the positive ground in a new turbulent day for Italian banks and signs of recession arriving from Germany. The banker assured yesterday that monetary policy will not change: "The reinvestments of assets acquired with Qe will continue to provide the necessary degree of monetary accommodation to bring inflation to our target".
MILAN WITHSTANDS THE IMPACT OF THE REQUESTS OF THE ECB
Even Milan thus absorbed the difficulties associated with the world of credit in the final stages. Piazza Affari (-0,03%) on 15 January closed at 19.165 points. The short-term prospects for the Italian economy are less and less brilliant: yesterday Bank of America Merrill Lynch cut its 0,2 GDP growth forecast to +0,7%, from +2019%. of Europe, thanks to the good performance of Wall Street: Frankfurt rises by 0,6%; Paris +0,49%; Madrid +0,43%.
On the other hand, Wednesday 16 January opened with the stock markets on the rise despite the vote of the British Parliament on Brexit hiding much more than a pitfall: Milan +0,7%, Frankfurt +0,13%, Paris +0,4%, Madrid +0,27%.
CONFIRMED THE HOLDING OF GERMAN GDP
In November, the Eurozone recorded a trade surplus of goods worth €19 billion. The figure is down compared to the 23,4 billion euros of the same month a year ago, but up compared to the 14 billion of October 2018. Overall exports of the euro area rose to 203 billion (+1,9%) , while imports stood at 183 billion (+4,7%).
The data arriving from Germany is also in the spotlight. In 2018, GDP rose by 1,5% (in line with expectations), the lowest rate in the last five years and a marked deceleration compared to 2,2% in 2017.
THE TREASURY FULLS UP: 35,5 BILLION LONG SECURITIES ASKED
Busy Tuesday for the debt market. The launch of the new 15-year BTP, which recorded record demand, put Italian bonds under pressure, especially along the long end of the curve. But it was a limited drop and at the end of the session, 2,87-year prices recovered somewhat, closing at 2,84% (against XNUMX%).
However, it was a triumphal day for the Treasury: demand for the 15-year bond, maturing in March 2035, reached 35,5 billion, three times the offer.
Long negative, the "old" fifteen year old recovered in the final (-0,005, with a yield of 3,206%). The thirty-year anniversary, on the other hand, leaves almost one point on the ground. On short maturities, on the other hand, the strengthening of the two-year bond continued, the yield of which fell to 0,39%, the lowest since June.
BANKS DISTURB: 7 YEARS OF TIME FOR BAD LOANS
In Piazza Affari, Tuesday was a day of tribulations for Italian banks, suspended in some cases due to excessive reductions during the morning, following the rumors about the latest requests from the ECB. The Supervisory Authority would have given seven years to the banks to bring non-performing loans to zero. During the day, Intesa Sanpaolo (-1,2%), Banco Bpm (-4%), Ubi Banca (-5%) and Bper Banca (-4,7%) specified that the latest communications from the ECB will not significant impacts on the objectives of 2018 and the following years, a reassurance that allowed the sector to move away from the lows of the session, but not to wipe out the losses: the sector suffered a drop of 2,19% in Italy, the European figure unchanged .
The story also reached Parliament. The ECB's decision to progressively raise coverage on non-performing loans causes "serious damage to Italy" according to the deputies of the Finance commission of the Chamber of the 5 Star Movement. "The umpteenth outstretched intervention by the ECB could cause damage to Italy worth 15 billion", wrote the Northern League's deputy prime minister Matteo Salvini.
However, the debacle of 15 January seems to have been archived and the banks in Milan are rebounding. Unicredit, the best stock of the Ftse Mib, gains 3,18%. Finecobank (+1,9%), Banco Bpm (+1,81%) and Intesa Sanpaolo (+1,57%) also performed well.
(Last update: 10.12 pm on 16 January).
