The drop in oil prices, as well as that in the yields of Eurozone bonds, bears witness to the worries of the markets about the loss of speed of the economic situation, held back among other things by the confrontation on tariffs. It is the first emergency that Christine Lagarde will inherit from Mario Draghi, who on the 25th will lead the directorate of the ECB for the last time. It could be an opportunity for a rate cut even if, as Loretta Meister, president of the Cleveland Fed argued yesterday, it is doubtful that monetary stimulus therapy is still able to prolong the infinite growth of the economy. Since July 120, the United States has officially been in the longest economic expansion cycle in its history, breaking the Clintonomics record of XNUMX consecutive months of growth. The markets thus set off, in a humble tone, for the appointments of the central banks at the end of the month.
AUSTRALIA CUT RATES, TRUMP DUTIES FOR EUROPE
Yesterday the Bank of Australia opened the game, with the expected cut in the cost of money. The markets alarmed by the statements of the governor of the Bank of England, Mark Carney, on the dangers of the return of protectionism (yesterday the list of US duties against Europe for aid to Airbus was announced) this morning they buy yen, the safe haven currency and turn back to gold +0,6%. Euro little moved at 1,128 against the dollar.
The main stock exchanges in Asia are down, with little trading, in view of the July 4th holiday in the United States: today Wall Street closes earlier, in view of Independence Day.
The PMI services index slows down in China despite government stimuli in favor of the sector. The Csi 300 index of Shanghai and Shenzhen, Hong Kong also weak. In Tokyo, the Nikkei index dropped 0,6%, the Korean Kospi down -0,9%.
BRENT LANDSLIDE (-4,1%), RESTRUCTURING FOR SAIPEM
Above all, the landslide in oil prices influenced the price lists. Yesterday Brent lost 4,1%: uncertainty about the possible slowdown of the global economy prevails over the effects of the OPEC agreement which extends supply cuts until March. Crude oil traded this morning at 62,58 dollars an ounce, +0,3%.
At Piazza Affari Eni -0,8%. Tenaris (-2,2%) and Saipem (-2,4%) fell sharply yesterday. Reuters talks about efforts to find a partner for the group's drilling activities by moving a top manager to head the business.
The decline in crude oil did not prevent Wall Street from closing yesterday in positive territory: Dow Jones +0,26%, S&P 500 +0,29%, Nasdaq +0,22%.
THE LAGARDE ERA BEGINS, ITALY WEIGHTS LESS IN BRUSSELS
The session of the European markets was dominated yesterday by the chess game to define the main positions of the future leader of the Eurozone. In the late afternoon the white smoke arrived: the German defense minister, Ursula von der Leyen, of the Cdu, will be the next president of the European Commission. The current number one of the International Monetary Fund, Christine Lagarde succeeds Mario Draghi as the next president of the ECB. The agreement between France and Germany is completed with the designation of the Belgian liberal Charles Michel as president of the European Council in place of Donald Tusk. A clear defeat for the sovereign front and a reduction of Italian influence on the tables that count in Europe.
Today the European Commission will evaluate whether or not to suspend the disciplinary procedure for excessive debt towards the Bel Paese. The forecast is that the procedure recommendation for excessive debt on Italy should be withdrawn, considering the Italian public accounts of 2019 in line with the Stability Pact. The confrontation between Italy and the European institutions is only postponed until the autumn, when the government will have to re-present the accounts in Brussels.
BUSINESS PLACE +0,65% AT THE TOP IN EUROPE
Piazza Affari (+0,65%) closed on a high note at 21.392 basis points, the first stock exchange in the Eurozone, despite the slowdown in oil prices.
Today the European Commission will evaluate whether or not to suspend the disciplinary procedure for excessive debt towards Italy.
The continental lists closed a moderately positive session: Frankfurt +0,04%, Paris +0,16%, Madrid +0,22%, London +0,83%.
TWO-YEAR BTP AT ZERO INTEREST, SPREAD AT 222
The decline in yields on debt securities continues. The yield of the XNUMX-year BTP is at its lowest for over a year, also driven by the hopes of a relaxation in the confrontation with Brussels on public finances.
The spread between the BTP and the Bund on the ten-year stretch closes at 222 points, the lowest since July 2018.
The August 2029 benchmark rate drops to 1,85% from 1,95% yesterday at the close, the lowest since May 2018.
But the performance of BTPs is part of a generally favorable context. Many euro area government bonds, both core and peripheral, hit record lows this week in response to indications that the ECB board is united and ready to ease monetary policy. It will be the worthy epilogue of super Mario Draghi's mission.
Money markets are pricing in a 50% chance of a 10 basis point rate cut by the central bank directorate in late July.
FERRARI IN POLE POSITION, UTILITIES GOOD
In pole position in Piazza Affari Ferrari which, with a gain of more than one percentage point, projects the price to the new historic record of 146,35 euros. Since the beginning of the year, the increase has been 66%, the best performance among the Milanese blue chips, beaten only by that of Azimut (+72/). In the last 12 months +24%.
Fiat Chrysler (-0,37%) wiped out the morning's losses. The group's US sales rose a surprise 2% to 206.083 vehicles driven by a 45% increase in sales of Ram models. Other manufacturers, including Hyundai Motor, reported higher US sales in June, helped by deep discounts of up to 30% or more on their most popular models in June amid a market slowdown.
The decline in interest rates continues to support the prices of utilities.
Enel advances by 2,19%, Snam and Italgas +2,5%. Terna closed up by 3,52%, A2A by 2,20%.
POSTE ITALIANE IN FLIGHT THANKS TO GOVERNMENT BONDS
Weak banks: Unicredit -1,1%, Ubi -2%. In the opposite direction Intesa Sanpaolo (+1%), one step away from the sale of 3,5 billion euro of non-performing and watchlist loans (Unlikely To Pay) to Prelios.
Poste Italiane was among the best blue chips of the session: +1,9% to 9,41 euros. Falling rates, and therefore government bonds growing in value, are good news for Poste too: in the first quarter of this year, capital gains on government bonds amounted to 261 million euros.
SOUL SHINES, MEDIASET LINKED TO WITHDRAWAL
Anima Holding also shines: +3% to 3,11 euros. Mediobanca promoted the stock to outperform with a target price of 4,50 euro. 91% of the brokers on the Bloomberg panel have a Buy recommendation on the stock and the fundamental average target is €4,75 (+53% upside).
Mediaset weak but above the lows of the session with a drop of 1,39% to 2,84 euros. The stock approached 2,77 euros in the session, the price set for the withdrawal linked to the reorganization that will lead to the creation of a Dutch holding company.
RECOVER ATLANTIA, BALZO DI ASTALDI
Atlantia (+3,8%) recovers the losses of the day before. The title accelerated after the diffusion of a draft of the report by the technicians of the Ministry of Transport according to which a different solution than the revocation of the concession is advisable, even if this is "really plausible". However, Deputy Prime Minister Luigi Di Maio reiterated that the unilateral termination of the concession is going ahead. Leap by Astaldi (+8,42%) awaiting news on the acquisition by Salini Impregilo +1,29% in the context of Progetto Italia, the Italian construction pole which should gradually involve other companies in the sector.
