Inflation rises, the rate dam cracks and the Stock Exchanges take note of it without making any drama. Some of the main stock exchanges in Asia Pacific are keeping pace with Wall Street futures (on the rise): Tokyo's Nikkei +1%, Seoul's Kospi +1%. The Chinese price lists are more timid, held back by the closure of Hong Kong, still hit by the fury of the typhoon. Confirmation of the generalized increase in prices comes from Beijing: +10,7% in September on an annual basis, it is the sharpest rise in a quarter of a century. Some industrial metals, such as copper (yesterday +2%) are on the rise again. The CSI 300 index of the Shanghai and Shenzen stock exchanges is down by 0,3%.
WALL STREET AWARDS BLACKROCK, JP MORGAN -2,6%
The US markets were mixed after the news on the inflation front and the start of the earnings campaign: Dow Jones -0,53%, S&P 500 +0,30%, Nasdaq +0,73%.
In the red JP Morgan (-2,6%) after the data for the quarter. On the other hand, BlackRock rose sharply (+3,8%). Today and tomorrow it will be the turn of the other banks, including Goldman Sachs, whose president yesterday stressed that inflation "is the real danger". But not only.
WAGES AND PENSIONS RUN IN THE USA. TAPERING CLOSE
From Trieste to Los Angeles the waterfront is heating up. The Julian airport risks becoming the battleground on the green pass. Meanwhile, in the US yesterday President Biden authorized the port of California to work non-stop until the enormous traffic jam of ships waiting to unload goods arriving from the East is cleared. Different behaviors, equal risks: missing goods on the shelves at Christmas, confirming that the legacy of Covid will still be felt for quite a while. And for the markets, the consequences are increasingly evident.
US inflation (+5,4% in September) recorded the sharpest rise in a decade. And from reading the Fed's minutes it emerges that bankers are now convinced that it is time to intervene. The hypothesis of the "temporary" nature of the increase no longer holds, given that, net of food and energy, the growth is 4% and is beginning to weigh on rising wages (+4,6%: dockers or truck drivers of Wal Mart will certainly not work overtime for free) and on pensions (the adjustment of social security, 5,9%, is the highest for forty years).
Overnight, Singapore, which is recording 6,5% GDP growth, raised its discount rate. It is the fourth country to adopt this measure since the beginning of September after New Zealand, South Korea and Norway.
GOLD SHINES AGAIN, CLOSE TO $1.800 AGAIN
Once the new situation has metabolized, the market is already thinking and looking to something else: not to inflation, which yesterday's data confirmed at high levels, but to the slowdown in the economic cycle caused by the increase in raw materials and the difficulties logistics that are bringing the supply of goods to its knees.
Gold experienced the brightest session of the year yesterday, with an increase of almost 2%, and this morning it is bought at 1.790 dollars an ounce.
The interest rate curve is flattened. The spread between five-year and 98-year Treasuries is again close to the lows of the last year and a half, at XNUMX basis points.
WTI oil was up 0,5% to $81 a barrel on US crude inventories release day. The reference association of US oil companies anticipates an increase of five million barrels.
Natural gas is back on the rise: yesterday the reference future for Europe gained 9%. China's coal imports jumped 76% in September from a year ago.
ODDO: “THE EU HAS A ZEN ATTITUDE ON INFLATION”
Doesn't the ECB have too Zen an attitude towards inflation? The analysts of Oddo Securities are asking after the new upward signals from the USA. But the Franco-German company offers three explanations: first, the rise in raw materials and logistics problems have not caused an increase in labor costs; second, the price increase can still be judged temporary; third, but not least, the bankers of Frankfurt are still well aware of the disaster of 2011, when, following the Bundesbank, Jean-Claude Trichet raised rates at the first signs of inflation. The result was the initiation of the Greek tragedy which brought the euro to the edge of the abyss. Christine Lagarde, is the conclusion, will not imitate him for sure. And so the euro, together with the yen, remains weak against both the dollar and the pound. Not bad, actually, good like this, at least as long as the bonds of the euro area travel by the thousands.
BTPs ALSO GET READY FOR TAPERING, AUCTION RISING
Short-term securities in the euro area discount the arrival of the US tapering (probable date, 3 November). But on longer maturities the feeling prevails that the Eurozone will not follow the wave of rising rates.
In line with the rally in long-term securities, the ten-year BTP closes at 0,89% (from 0,91% at the last closing); the 30-year period drops more significantly to 1,01% (from 1,07%). The shorter maturities moved less: 5 years at 0,11%, two years at -0,47%.
German Bund down -0,13%, following the T-bond. The spread is slightly up to 103 basis points. Germany placed 816 million in the 30-year Bund with an average rate that rose to 0,35% from -0,04% in the previous auction.
In the aftermath of the record debut of the EU in the world of green bonds, the Treasury has placed 6,5 billion euros, the maximum amount offered, in the reopening of 3, 7 and 30-year bonds with rising yields that have hit a five-month high for the two longest maturities.
MILAN (-0,12%) HOLDED DOWN BY BANKS
Banks and oil stocks hold back Piazza Affari, which closes down by 0,12%, at 25.958 points. Down also Madrid (-0,54%), the other place more sensitive to the performance of the banking sector. London (+0,18%) and Amsterdam (+0,83%) rose. Frankfurt appreciates by 0,63%: the SAP software group runs (+4,2%), after optimistic forecasts.
Volkswagen shares also shine in the German basket (+2,72%), galvanized by the hypothesis of a cut of 30 jobs. The managing director, Herbert Diess, spoke of "fears for the future of the company", waving the specter of "cuts of up to 30 jobs" necessary to maintain the group's competitiveness during the transition to electric power.
LVMH SHAKES LUXURY
Paris +0,75%. The market response to Lvmh's quarterly accounts (+3,75%) dragged the price list thanks to the expansion of leather goods revenues (+24%) and the stability of the Chinese market.
On the other hand, Axa loses ground (-2,21%): the company will have to deal with the surge in claims linked to the Hong Kong typhoon.
MONCLER RUNS AT PIAZZA AFFARI
Pharmaceuticals and utilities stand out in Milan, while profit-taking on oil and financial companies prevails and the LVMH effect is also being felt in Piazza Affari. Sale Moncler (+2,6%), as well as Tod's (+3%). Tampons, on the other hand, push Diasorin upwards (+3,3%). Recorded +2,58%.
UTILITIES RECOVER, STM BOUNCES
Among the utilities, penalized in the first part of the session by the rise in interest rates, Terna (+0,45%), Enel (+0,50%) and A2A (+1,4%) recovered. Italgas and Snam remain at stake.
Stm also rebounds (+0,95%) despite Apple having to cut the production of the iPhone 13 by 10 million pieces due to the lack of chips. Nexi +2,7%.
OPEC CAUTIOUS ON CONSUMPTION, OIL DOWN
Oil companies down: Eni -1,7%, Saipem -2,2% and Tenaris -2,1%. OPEC expects demand to grow by 2022 million b/d in 4,2, while for 2021 it now estimates demand growth of 5,8 million b/d, down slightly from its previous projection of 5,96 .XNUMX million barrels per day.
BANKS AT THE BOTTOM OF THE LIST
Sales in the banking and insurance sector are increasing. Seven of the session's ten worst blue chips are financial stocks. Banco Bpm down by 2,35%, Unipol -1,68%. The big ones also sold: Unicredit -2%, Intesa -0,9%. Little move Stellantis (-0,17%), in a globally positive context for the auto sector in Europe (+0,3%).
AMONG THE SMALLS, ZIGNAGO, SABAF AND FIERA MILANO SHINE
Milan Fair +3,3%. Equita underlines that from a virtual meeting with the top management of the company "positive messages emerged on the trend of the business and M&A is not excluded".
Zignago also shone: +3,39%, at 17,08 euros. The share was driven by Banca Akros, which started hedging with accumulated ratings and tp of 20,5 euros.
Sabaf rallies (+5,24%). The company completed the purchase of 30% of ARC's capital, in execution of the agreement that was signed between the parties in 2016, when the Brescia-based company had already acquired 70%. On the Aim in evidence Health I. (+35,21%), after the heavy losses of the last few days. The stock had collapsed in the wake of the investigation against the group's director Massimiliano Alfieri and the application of a preventive seizure against him. The company reiterated that it was totally unrelated to the facts alleged against some of its managers.
