At the macroeconomic level our country is experiencing a slowdown: in the second quarter of 2016, growth stalled (+0,0% q/q), the PMI index of the manufacturing sector and consumer confidence collapsed and, as reported the monthly note of Istat, the phase of weakness we have entered does not seem to be "passing".
Also growth in the euro area has stalled, but the German contribution helped limit the damage and the first data for August suggest that the third quarter will be in line with the second: according to our synthetic GDP indicator, the Eurozone should grow by 0,4% on a quarterly basis and 1,1% on an annual basis.
The situation in the United States is different, where economic growth is already a reality. Despite some worse-than-expected data, the Atlanta FED estimates a 3,5% annualized GDP increase for the third quarter.
Until now economists have largely overestimated the Brexit risk and the UK data is turning out to be better than expected. In this phase of calm, even the banks are catching up, after the stress tests in July highlighted a European banking system in good health, with the exception of Monte dei Paschi di Siena. After starting the resolution of problems related to the solvency of Italian banking institutions, now the new challenge is to be found in the core business of companies, i.e. how to create sustainable profitability over time. Hence the warning of the Economy Minister, Pier Carlo Padoan, who last month called for a "profound restructuring" following the data on the profits of our banks, practically halved if considered in aggregate.
In the last month there have been no major changes in terms of ratings: have substantially remained in line with those of the previous month, so that we remain moderately positive on the US and Japanese stock markets. In Europe, valuations of the British market improved, while Emerging Countries, confirming themselves as the best asset class of the year, remained stable.
A bond level, the best risk/return profile is found in the USA (both corporate and government bonds) and in Emerging Countries; yields instead zeroed (or negative) for the European market, dominated by the accommodating policy of the ECB.
The next "market movers" that the markets will have to deal with have a very specific characteristic: politics. This source of risk, sometimes underestimated, will play a primary role in the coming months in Europe, where citizens of Austria, Hungary and Italy (the most critical political variable) are called to vote, while in Spain the government of Rajoy he did not win the government's trust and the possibility of having to return to the polls for the third time in a year is becoming more and more concrete. But the undisputed protagonists are the American elections: on 8 November the political (and economic) direction of one of the most influential countries in the world will be decided.
Also noteworthy are the movements of central banks: the last meeting of the ECB saw no changes to the Qe in progress, however leaving room for action in the event that the recovery does not accelerate. Turning to the USA, after the inconclusive meeting in Jackson Hole, Janet Yellen's FED will meet again on Wednesday 21st, even if, with the presidential elections upon us, it is more probable that any rate hike will not arrive before the meeting of December.
