Surprise: the financial week seems destined to reserve a "happy end" worthy of a fiction in pink. USA and China. Donald Trump, a few hours after the meeting with the Chinese deputy premier Liu He went so far as to say that "things are going very well". Distances remain on intellectual property, but the Bigs seem close to an agreement on exchange rates: China has allegedly undertaken not to maneuver the exchange rate any more. In return, Beijing should obtain the cancellation of duties, both those already in force and those threatened.
Good news on the Brexit. At the end of two and a half hours of talks with Boris Johnson, Irish Prime Minister Leo Varadkar urged the reopening of dialogue with England on Brexit, as there are now the conditions for reaching an agreement.
The good news has brought peace back to the equity markets. As a consequence, bonds are losing ground, especially in Europe, under the pressure of the hawks' no to the ECB's expansionary policy, which is in any case necessary given the economic situation. Today Mario Draghi will be able to answer from the chair of the Catholic University which will award him an honorary degree.
But this is not enough to erase the optimism which, in truth so far, rests only on a joke from the US president, not exactly a model of sincerity.
ASIA SU, SHINE HONG KONG
All on the Asian stock exchanges this morning. The liveliest is Hong Kong +2%, perhaps on the eve of a less agitated weekend. Tokyo Nikkei +1%. Shanghai and Shenzhen CSI 300 +0,4%, Seoul Kospi +1%, Sydney S&P/ASX +0,8%.
Meanwhile, news arrives from Singapore that James Dyson, the English billionaire inventor, has given up on starting an electric car project. Meanwhile, Nio, the Chinese answer to Tesla, which is also in difficulty, is heading towards bankruptcy.
SALT WALL STREET, APPLES ON SHIELDS
-Positive closure also for the US markets. The Dow Jones is up 0,57&, S&P 500 up 0,64%. The Nasdaq +0,65 was also good, driven by Apple +1,3%: Longbow Research analysts promoted the stock given the growth in demand for the iPhone 11.
– Safe-haven assets are losing ground, starting with the yen, which fell to 108 against the dollar.
– Gold closed down 0,8% last night, trading at $1.495 an ounce this morning.
– Brent oil up for the third consecutive day to 59,4 dollars a barrel.
DEPARTURE AT THE RIALZL FOR THE EUROPEAN PRICE LISTS
– European stock futures anticipate a higher start. The euro-sterling exchange rate, which fell sharply by 1,5% yesterday, moved little at 0,885 at the opening.
THE HAWKS SOUND AGAINST QE. GOES UP THE BUND
Yesterday was a busy day for European bonds shaken by the publication of the minutes of the last ECB directorate from which emerges the deep distance between hawks and doves that prompted Mario Draghi to promote QE against the contrary opinion also of the offices of the central bank. These tensions favored the upward run of yields: the new securities purchase plan was born with a heavy mortgage, as demonstrated by the outcry of German finance.
The 0,48-year German Bund rose to -6% (+33 basis points), on the highs for three weeks. The thirtieth anniversary has risen above the psychological threshold of "zero". The observation, contained in the minutes of the last meeting of the ECB, that the threshold of XNUMX% of the Bund in the hands of the institute is approaching, the boundary envisaged by the QE, contributes to conditioning the market. “The real problem – comments Jacqui Douglas strategist of TD – is that the ECB is already doing everything it can do”.
THE TREASURY PREPARES THE BTP IN YEN
After the success recorded with the first issue in dollars, the Ministry of the Economy is studying new securities in dollars in the 'global bond' format and 'private placement' in yen and other currencies other than the euro. This was said by Davide Iacoboni, head of the Italian public debt.
The 5-year bond offers a gross yield at issue of 2,435% in dollars. The 10 and 30 year tranches have a yield of 2,981% and 4,022% respectively.
Iacoboni also confirmed the 2019 issue of the new BTP Italia, the inflation-indexed bond for retail investors. “We will return - he said - to the 8-year maturity. The issue will be placed in three days, two for retail investors and one for institutional investors”.
THE RATE OF BOTS RISES AT AUCTION, TODAY 6,5 BILLION FOR A LONG TIME
The Treasury auctioned 6 billion annual BOTs at the highest yield since July at -0,219% from -0,226% in mid-September. The offer on 3, 7, 20 and 30-year BTPs for an amount of 5-6,5 billion is scheduled today.
The spread with the Bund increased to 144 basis points (+1,97%).
European markets have also bet on a successful outcome of the round of negotiations between the United States and China: stock markets rise and bonds fall
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