Sales and profit taking on European stock exchanges despite the success of the Greek debt auction and better-than-expected data on US unemployment benefits. Milan closes down by 1,33% while the spread closed up at 163 basis points. Nonetheless, it was a positive day on the government bond front. Today the Treasury achieved, albeit only slightly, a new historic record by placing 7,5 billion BOTs annually with yields of 0,589% against the previous 0,592%. Requests totaled over 10,2 billion, with a coverage ratio of 1,36. On the other hand, the data on industrial production in February was disappointing, rising by only 0,4% year on year from +1,2% in January, while economists had expected an increase of 1,1%.
Greece successfully closed its first placement of government bonds four years after the last auction: it has placed five-year bonds for 3 billion euro and a demand of over 20 billion euro from over 500 institutional investors, of which around 90% are foreign. Europe is also in the red: Paris -0,66%, Frankfurt -0,55%, Madrid -1,42%. London resists in positive territory and closes at +0,10%. The Bank of England today left its key rate unchanged at 0,50 per cent and confirmed its £375 billion bond buyback plan. The monthly bulletin of the ECB was then published during the day: the labor market is beginning to show the first signs of improvement and the first quarter of 2104 confirms the expectations of an increasingly favored recovery by more robust domestic demand. Between the lines of the Eurotower there is a veiled criticism of the Fed: for the Eurotower the conditions of the labor market in the US are fragile because the recovery, with the unemployment rate at 6,7%, conceals a fall in the participation rate , with worse data when considering discouraged workers, long-term unemployed and part-time workers who would prefer full-time work.
Last evening the Fed published the minutes of the last FOMC meeting which revealed that on that occasion there was no mention of a rate hike six months after the conclusion of the tapering, as suggested by Janet Yellen herself at the subsequent press conference. In addition, all governors present approved Yellen's decision to cancel the previous forward guidance, which envisaged raising rates once the target of 6,5% unemployment was reached, and replace it with more generic indications. Translated, more doves than hawks on the road to tapering. Wall Street celebrated yesterday while today's opening gave way to profit taking. The indices opened the decline and at the close of Europe confirmed the declines despite the release of data on jobless claims better than expected and at the lowest since May 2007. Initial claims fell by 32 thousand to a seasonally adjusted level of 300 thousand in the week ended on April 5th. Expectations were for 320 requests. The euro strengthened against the dollar to 1,3894 while WTI oil fell back by 0,29% to 103,3 dollars a barrel.
In Piazza Affari, sales hit the banks: Mps -4,29%. Siena launched a one billion euro covered bond against a request of around four billion and managed to get a premium lower than 175 basis points above the midswap, at 160. Ubi Banca sells 4,10%, Azimut 3,15%. Banco Popolare (-2,14%), on the last day to trade the rights associated with the 1,5 billion euro capital increase on the Stock Exchange. A2A -3,11% and Mediaset -3,10% also down. The luxury runs against the trend after the better-than-expected Lvmh data: Ferragamo +1,12%, Moncler +1,04%, Yoox +0,88%. However, the best title is Saipem +2,66%. Telecom Italia also rises +0,4% on the hypothesis that the Brazilian group Oi is about to make an offer for Tim Brasil. The telecommunications group has also signed an agreement with Sky to have the TV broadcaster's contents transit through its fiber optic network starting next year.
