The Italian financial week opens under the banner of rescue of Banca Popolare di Bari decided by the Council of Ministers, which yesterday evening approved the intervention under the formula of "Urgent measures to support the credit system of the South and for the creation of an investment bank", as the title of the decree states. Basically, 900 million were allocated to equip Mediocredito Centrale so that, through Invitalia, it would intervene in the institute, giving rise to the establishment of an investment bank. Beyond words, a new banking emergency is averted at great cost. Meanwhile, the Bank of Italy is preparing to update today the amount of public debt, forecast for October at 2.439,2 billion euros. In this context, tensions on public finances cannot be excluded, also because today the maxi-amendment on the maneuver on which the request for a vote of confidence is taken for granted is arriving in Parliament.
These domestic concerns do not disturb the confidence of the stock markets, which promise a positive end to the year after the agreement on tariffs between China and the USA and the outcome of the vote in the United Kingdom. Asian stock markets advanced to eight-month highs, supported by the confirmation of peace between the big names. The US has canceled tariff increases for 160 billion dollars and halved the tariffs for another 120 billion. In turn, China has suspended additional tariffs on some US goods that should have been applied starting December 15 on US-made corn, wheat, vehicles, auto parts.
THE CHINESE ECONOMY STARTS AGAIN WITH MAKEUP
More than all, the Sydney Stock Exchange (+1,7%), the most sensitive to the trend in demand from the Chinese economy, celebrates. Tokyo's reaction was more tepid (+0,05%) on the eve of the Central Bank meeting: no news is expected on the front of negative rates after the latest wave of stimuli (21 billion dollars) announced by Prime Minister Shinzo Abe.
Shanghai on the rise (+0,4%). China's stock market indices react positively to the macro data released this morning. Retail sales in November recorded an 8% year-on-year increase against 7,2% in October and 7,6% estimated by economists. This is the largest increase since June. Decisive contribution from cosmetic products (+16,8% from +6,2% in October), household appliances (+9,7% from +0,7%) and furniture (+6,5% from +1,8 %). In the first 11 months of the year, retail sales increased by 8% over the same period in 2018.
President Xi announced that he will travel to Macau on Friday: the former Portuguese colony, which did not participate in the protests, could become the new financial hub by replacing the "rebel" Hong Kong (-0,4%).
THE T BOND STRENGTHENS, EUROPEAN OPENING WITH THE PLUS SIGN
The signs of easing on the markets are multiplying. US T bonds strengthened to 1,84%, the yen falls against the dollar to 109,38. The pound's rally continues after the triumph of Boris Johnson: +0,48% to 1,3389 against the US currency. The euro trades at 1,1132.
Gold fell slightly (-0,06%). The yellow metal, like other safe-haven assets, is losing some of its appeal: the most popular ETF on the yellow metal is down 7% from its October highs.
Oil was down slightly: Brent traded this morning at 64,98 dollars, down 0,37%.
The EuroStoxx50 index future anticipates a 0,6% rise. Last week closed with an increase of 0,7%.
EVERYTHING READY FOR AGREEMENT WITH PEUGEOT
The highlight of the week should be the signing of the memorandum of understanding between PSA and Fiat Chrysler. Over the weekend, the two delegations filed the agreement.
It has been established that, at the time of the partial disengagement of Dongfeng, the Chinese partner of PSA which will have to reduce its stake to avoid Washington's no, the Peugeot family will buy 2,5% which will thus balance its stake with respect to the Lambs.
Even after the eventual departure of Carlos Tavares, who will lead the group for the next 5 years, his place will be taken by a councilor chosen by the French.
Any charges for the tax disputes against FCA or for the lawsuit brought by GM will be negotiated within the 5,5 billion already counted to the benefit of Exor.
CENTRAL BANKS IN REPORT. SWEDEN COMES OUT OF NEGATIVE RATES
It will still be a busy week for central banks. To follow the meeting of the Japanese and Swedish central banks, two countries with rates below zero. The forecast is that Stockholm will raise the cost of borrowing from -0,25% to 0%.
Also in the spotlight was the meeting of the Bank of England, dedicated to bank stress tests, the first monetary test after the vote.
WEIDMANN WANTS MORE PUBLIC SPENDING
In the meantime, Bundesbank president Jens Weidmann's interview with the Suddeutsche Zeitung caused a sensation. The banker took sides against the "fetish" of the public budget surplus, adding his voice to the chorus of those calling for an increase in public spending. A nice help to Christine Lagarde but, say the malicious ones about her, the confirmation that many nos in the past have been dictated by hostility towards Mario Draghi.
The PMI manufacturing and services indices for France and Germany and the Eurozone will be released today.
The Empire Building Manufacturing index relating to the performance of the economy in the north-east will be disseminated on Wall Street.
In terms of duties, attention is focused on the dispute between the US and the European Union: during the week, tariff increases on some goods, including whiskey and cognac, could be triggered.
Donald Trump anxiously awaits the arrival of the impeachment procedure. “From an electoral point of view – he reiterated – for me it is a big advantage”. Meanwhile, Thursday there will be a new TV debate between the eight Democratic challengers in view of the presidential elections. But Michael Bloomberg will not be there, excluded because he does not intend to receive campaign contributions.
DIVIDEND FOR STM, ACCOUNTS FOR NIKE AND FEDEX AND FOR MARIJUANA
On the equity front, the Piazza Affari calendar provides for the distribution of the quarterly dividend of Stm (0.06 euro).
On Wall Street the accounts of Nike and FedEx are in the spotlight. The last episode of Star Wars, Walt Disney's most profitable saga, will be released on the 20th. But there are also the first accounts of marijuana producers listed on US stock exchanges.
