The spread of the virus is slowing down: according to Chinese sources, the new cases of Covid-19 (since yesterday the disease has a name) were 1.068 yesterday, compared to 3 at the beginning of February. New deaths are also down, down to 97, an increase that brings the total to 1.115. It is early to claim victory, but early enough to start a return to normality in China, as requested by the leaders of Beijing. Yesterday President Xi Jingping, during a phone call to the President of Indonesia, said: "We are confident that we can defeat the epidemic and meet the economic growth objectives set". The markets want to believe it. Even the Fed, yesterday, threw water on the fire: there will be effects on the global economy, admitted chairman Jerome Powell, but not so serious as to jeopardize the continuation of the expansionary cycle of the US economy, which has lasted for eleven years. In the meantime, the records of the price lists multiply.
SAMSUNG SALES (+1,17%) WITH THE FOLDABLE SMARTPHONE
Tokyo's Nikkei is up 0,7% after reopening. Hong's Hang Seng +0,7%, Shanghai Composite +0,6%, the seventh consecutive day with the plus sign. Samsung advances in Seoul (+1,17%), which yesterday presented the foldable smartphone and a series of mobile devices compatible with 5G in San Francisco.
China's yuan appreciated for the third consecutive day against the dollar, at 6,96. The US currency retreats against most of its Asian counterparts: Korean won cross -0,3%, to 1.177.
Wall Street also participates in the upside: S&P 500 +0,11%, Nadaq +0,17%. Prices were held back by the decision of the Federal Trade Commission to investigate the mergers of the tech giants. The investigation mainly concerns Microsoft, but also affects the other big names.
BILLIONAIRE WEDDING BETWEEN T-MOBIL AND SPRINT (+77%)
Big hit in the TLC market. The merger between T-Mobil and Sprint, i.e. the third and fourth force in the market, has received the go-ahead from the authorities. The deal, valued at around $26 billion, drove T Mobil up 11,8%. Sprint, owned by Masayoshi Son, jumped 77,8%.
Brent oil trades at $55 a barrel, up 1,8% from yesterday's +1,4%. The API reported that US weekly inventories increased by 6 million barrels. The EIA government figure is expected this afternoon: estimates are for an increase of 3 million. Yesterday Saipem +2,76%, Eni +1,14%
Gold fell slightly to 1.565 dollars an ounce.
Futures on European stock exchanges anticipate an upward start. Yesterday the Eurostoxx 50 index reached its highest level since April 2015 without paying too much attention to the warning coming from the ECB and the problems of the economic situation, far from brilliant especially in Italy and Germany.
LAGARDE: MONETARY POLICY ALONE IS NOT ENOUGH
“Monetary policy cannot be the only solution”, the president of the ECB, Christine Lagarde, reiterated yesterday in front of the European Parliament, illustrating the plan to revise the objectives of EU policy. A warning addressed more to Germany, hit by a harsh conflict triggered by the decision of the CDU to ally itself in Thuringia with the extreme right, which then returned due to the intervention of Angela Merkel. The tug of war affecting the balance of the leading economy of Euroland coincides not by chance with the renewed tensions on the euro, at its lowest since September against the dollar, at 1,091. Lagarde also noted that “euro area growth momentum has slowed since early 2018, mainly due to global uncertainties and weaker international trade; moderate growth has also eased pressure on prices and inflation remains some distance below our target”. But the Stock Exchanges have snubbed the alarm.
MILAN FLYING TO THE HIGHEST SINCE 2008, ENEL SUPERSTAR 2020
Piazza Affari closed at its highest level since 2008 (+0,74%, 24.688 basis points) and marks an increase in line with the other European lists. The five best blue chips since the beginning of 2020 are: Enel +16%, Stm +15%; Leonardo +12%; Azimuth +11% and Italgas +10%.
Frankfurt (+1,01%) also closed close to its all-time high. Paris +0,65%; Madrid +0,57%. London +0,69%: Britain's gross domestic product, in the preliminary reading, remained unchanged in the fourth quarter on a quarterly basis, a figure lower than consensus estimates, which expected a rise of 0,3%. On a trend basis, GDP rose by 1,1%.
FOR THE NEW BTP 15 REQUESTS FOR 48 BILLION
The BTP ended weakly, in line with the rest of the euro bonds, a session dominated by the syndicated placement of the new 15-year bond, which obtained record requests from investors: orders exceeded 48 billion euros, with the yield set at five basis points more than the BTP in March 2035, down from the initial nine points, then reduced to seven.
The Italy-Germany yield premium on the ten-year segment is worth 140 basis points, stable since the last closing.
The 10-year benchmark rate trades at 0,97% from 0,95% at the end of yesterday's session.
Attention now shifts to tomorrow's auction, when the Treasury will offer 6 billion euro of 12-month BOTs (6,5 billion maturing).
MONCLER: THE IMPACT OF THE VIRUS IS "VERY SERIOUS"
The party was not attended by luxury, struggling with the effects of the epidemic. Moncler (-3%) closed the fourth quarter with results penalized by the demonstrations in Hong Kong, but rebalanced by the excellent results, in terms of sales, in Europe and the Americas. The company said 2020 got off to a very good start, before the fall, caused by the epidemic in central China. Chief Financial Officer Luciano Santel warned that business impact is “very serious”. The company also announced, together with the data, the introduction of the increased voting system, which will raise the managing director Remo Ruffini to 29,9% of the capital, from the current 22%. Société Générale cuts the judgment to Hold, from Buy. Deutsche Bank cuts the target price to 37,5 euros, from 38,5 euros.
Salvatore Ferragamo -2%.
UTILITY, KEPLER PROMOTES HERA AND A2A
On the utilities front, the judgments of Kepler Cheuvreux held the scene: Iren +2,3% (target price from 3 to 3,5 euro), A2A +1,8% (target price from 1,6 to 2 euro), Acea +0,7% (from 20 to 22 euros), Hera +0,5% (from 3,8 to 4 euros), AscoPiave -1,7% (the judgment drops to Hold).
BANKS, THE EU SENDS POP.SONDRIO INTO ORBIT
Among the banks, Popolare di Sondrio closes in rally (+6,37%), after the Advocate General to the EU Court ruled that the 2015 Italian regulations on cooperative banks do not violate EU law.
Ubi follows, on which Kepler Cheuvreux analysts raised the target price from 2,7 to 3,1 euros, confirming the hold recommendation after the 2019 accounts. Mps rebounds (+3,29%). The big names were positive: Unicredit +1,5%, Intesa +0,96%.
FINECO SLIDES -5,1%, BANCA GENERALI GOOD
In assets under management, a cold shower for FinecoBank (-5,61%), despite the announcement of record results in 2019. Azimut -1,52%. Banca Generali was positive (+1,61%). The day after the publication of the quarterly data, Banca Imi reiterates its hold rating, target price at 28,2 euro.
PRYSMIAN RUNS, PIRELLI SWENDS
Among industrialists, Prysmian (+2,81%) and Stm (+2,58%) performed well. Pirelli loses ground (-1,29%): Equita Sim lowered the target price from 6,6 to 5,9 euro, confirming the hold rating. Competitor Michelin closed 2019 with slightly better results than expected, but only in terms of revenues. Forecasts for 2020 are disappointing, the year should close with an operating profit, flat at best, while the consensus expected a 3% increase. The Agnelli team did well: Ferrari +2,91%, Cnh +1,23%, FCA +1,21% (Banca IMI has reduced the target price from 16 to 15 euros).
