Final of the week in pink. The most surprising and welcome image is that of the two Korean leaders, Moon and the pyrotechnician Kim, arm in arm through the streets of Panmunjon, the border village which for the first time since 1953 hosted a visit from a Pyongyang leader. The Seoul Stock Exchange advances by 0,5% pending dinner between the two.
Less bloody and surprising, but no less important for the European markets, the choice of the ECB not to touch monetary policy, thus favoring the fall of the euro (1,21 against the dollar) and giving a boost to the European equity indices.
Meanwhile, Wall Street is crazy about the big names in technology, starting with Amazon. There are signs of a slowdown in economies, recognized by Mario Draghi himself, but in the meantime the stock exchanges are celebrating the last glimpse of a long summer.
The Japanese Stock Exchange is starting to close up by 0,7%, while the yen is little moved. Even in Japan, as in Europe, there is no sign of inflation. In the statement released tonight, the country's central bank admitted that it does not know when the 2% target previously indicated in 2019 will be reached. For the rest, the Bank of Japan confirmed the monetary policy guidelines: this morning it's Governor Haruhiko Kuroda's press conference.
Third consecutive day of decline for Chinese stock markets: CSI 300 index of Shanghai and Shenzhen stock exchanges -1%, from -2% yesterday. The injection of liquidity already anticipated by a newspaper close to the Communist Party at the beginning of the week has not yet arrived on the Chinese stock exchanges.
On US markets, tension on bonds eased yesterday. The Treasury Bill yield fell to 2,97%, moving away from the critical 3% mark.
Thanks to the rally in technology stocks, the Nasdaq (+1,64%) led the recovery of the stock markets. The Dow Jones (+0,99%) also rose thanks above all to the inspiration of Visa (+4,7%) and Home Depot (+4,8%). Both the world's number one credit card company and the home improvement department store chain released higher-than-expected quarterly figures. The S&P 500 index also rose (+1,04%).
The star of the day was Facebook (+9,1%), after the impressive rise in profits. The Fang index, which includes the biggest and most well-known names in technology, (Facebook, Alphabet, Amazon and Netflix) rose 3%, the first positive sign after 5 days of declines. SPDR S&P US Technology ETF SXLK.MI gained 1,8%.
The rally continued after the Stock Exchange, on the wave of the publication of the Amazon accounts (+6%). In addition to the excellent results and even brighter prospects for the second quarter, the news of an exclusive agreement between Amazon Prime Video and the NFL, the American football league, for TV rights helped boost Jeff Bezos' company .
Intel also flies (+5,1%) dragging the chips (sector index +2,1%). Brent oil traded at 74,5 dollars a barrel this morning, down slightly from yesterday's +1%. Piazza Affari awaits Eni's results, +2% yesterday. Since the beginning of the year, the stock has so far achieved an increase of 16%, 5 points more than the European sector index.
DRAGHI GIVE A CHARM TO MILAN (+1%)
The European markets are all positive thanks to the push of Mario Draghi. From the words of the president it was understood that there will be no talk of raising interest rates in the eurozone until at least 2020.
The matter of the Milan Stock Exchange picks up speed, which rises by 1% and recovers 24 (24.035 points), the highest for almost three years, i.e. since July 2015.
Supported by the fall of the euro against the dollar (which fell to 1,21 during the conference of the president of the ECB to a six-week low) all the lists rose: Paris +0,74%, Frankfurt up 0,63%, conditioned by the swing in Madrid (+0,45%). Outside the perimeter of the single currency, London is advancing (+0,53%). The Oscar for the best list goes to Zurich (+1,08%).
ITALY RISK FALLS: CDS AT LOWEST SINCE 2014
Credit default swaps on Italy's debt fell to their lowest since September 2014. The 5-year CDS on Italian debt slipped to 83,730, hitting its lowest level since mid-September 2014. Basically the cost to insure 10 million euros of debt has dropped to 83.730 euros.
No news on the monetary policy front from the directorate of the European Central Bank. The unexpected slowdown in the European economy will be assessed in the light of the quarterly update of the macro estimates scheduled for the meeting on 7 June. Until then, rates remain unchanged: the main one at 0%, the one on marginal loans at 0,25% and the one on deposits at -0,40%. The guidelines of the Quantitiative Easing program are also unchanged. Securities purchases will continue at a rate of 30 billion a month until September "or beyond if necessary".
The yields of government bonds in the Eurozone are reduced. The 10-year BTP drops to 1,75, while the spread with the Bund widens slightly to 115.50 (+0,96%)
TODAY'S BTP AUCTION, SPREAD TO 116
After the monetary policy council meeting in Frankfurt and the subsequent press conference, the BTP appears firm, consistent with the rise of the morning, but the Bund takes a slight step forward: the spread thus closes at 116 points from a minimum of 113. The yield of the Italian 1,75-year bond stops at XNUMX% pending today's auctions.
On the primary front, the Treasury placed 6 billion euro of the 6-month BOT, with the rate rising to the highest level since the February auction. Today will be the turn of the medium and long-term auction with the offer between 7,75 and 9,25 billion BTPs over five and ten years, together with the new CctEu September 2025.
FCA MAKES MORE PROFITS THAN GM, IT'S ABOUT THE DIVIDEND
In the first quarter of 2018 Fiat Chrysler (+2,03% to 19,53 euros) recorded profits higher than those of GM: 1,6 billion dollars (or 1,2 billion euros, +59%) against 1,1 billion of Detroit rivals . A sensational overtaking, which smacks of revenge for Sergio Marchionne rejected by Mary Barra, CEO of the Detroit competitor. The number one of FCA, after reiterating his intention to leave the leadership of the company in 2019. Even more important, in the eyes of the markets, is the significant drop in debt: 1,313 billion against 2,390 billion at the end of 2017. Marchionne during the conference call he declared that “if we have the pleasant surprise on June 1st”, ie the zeroing of net industrial debt, “the dividend will reappear in the future” with the new business plan.
MEDIASE T SUPERSTAR, ELLIOTT ATTACKS BOLLORÉ
In Piazza Affari it was also the day of recovery for Mediaset (+2,4%) at 3,354 euros, after a session high of 3,46 euros, the highest level since August 2017, with volumes more than double the monthly average . Traders have not reported any particular news underlying the sudden rise in the Alfa stock, at least in part to be attributed to the difficulties of the enemy Bolloré, in a state of judicial custody after being indicted in the Nanterre court. Regarding the results, announced at the beginning of the week, opinions are conflicting: Berenberg has raised the judgment to Buy from Hold and pushed the target price to 3,80 euros from 3,20 euros. Meanwhile Mediobanca says to buy (Outperform, target 4,34 euros), Equita says to hold (Hold, target 3,90 euros) and JP Morgan says to sell (Underweight, target 3,10 euros).
Telecom Italia also rebounds + 0,5%. In view of the shareholders' meeting on May 4th, the confrontation between Vivendi and the Elliott fund continues. “We are deeply concerned by the recent corruption allegations involving Vincent Bolloré,” reads a letter sent by Elliott to shareholders. Not out of solidarity but because "it seems difficult for us to reconcile a vote for Vivendi and the pursuit of good governance".
Speaking of shareholders' battles, the Retelit shareholders' meeting is scheduled for today (+3,6%) pending discussions for the renewal of the board of directors between the consortium of Shareholder Value Management (Svm), which aims at confirming the top managers in office and that of Fiber 4.0 led by financier Raffaele Mincione and, inclined to revolutionize the board.
BANKS POSITIVE, ENEL'S ATTACK IN BRAZIL
The banking sector was positive +0,54%. The best stock was Banco Bpm (+1%). the worst Mps (-1%). Creval stands out in particular (+2,2%): the president, Miro Fiordi, said in an interview with Il Sole 24-Ore that now "one can think of mergers or advanced forms of partnership between significant realities".
Enel advances (+1,3%) engaged in Brazilian challenge for Eletropaulo. The group raised its offer to 32 reais per share. Iberdrola responded immediately: 32,1 reais together. The Spaniards have sent a letter to the European Commission in which they accuse Enel of unfair competition because, according to them, Enel "does not operate according to market criteria".
The other utilities performed well: A2A +2,13%, Snam +1,8%, Italgas +1,58% and Terna +1,3%.
PRIVATE COMPANIES PRESSURE ON TOD'S FOR THE FAY BRAND
In the luxury sector, you buy on Tod's which earns 1,2%. Some private equity funds are interested in the Fay brand, but the group has denied a possible sale. Weak Ferragamo (-0,57%). Moncler at new highs (+0,83% at 36,40 euros).
Among the small caps, As Roma continues to suffer, with a drop of 3,8% which adds to the -9,9% of Wednesday after the defeat in the Champions League at the hands of Liverpool.
