Mixed start for the Asian stock exchanges. Tokyo slows down (-0,5%) on the eve of the VAT increase from 8 to 10%, the second in the long season of government of Shinzo Abe, a decisive move to bring the overflowing public debt under control.
In the last session before the very long pause for the celebrations of the anniversary of the founding of the People's Republic of China, China's stock markets fell: CSI 300 index of the Shanghai and Shenzhen stock markets -0,5%. China's manufacturing industry showed signs of recovery in September, but remains weak. The PMI index on the expectations of purchasing managers of manufacturing companies rose to 49,8 in September, remaining below the threshold between contraction and expansion.
BUDWEISER DEBUT, MODI CELEBRATES THE TOILETS
Hong Kong, on the other hand, rose under the impetus of the positive debut of the listing of Asia Budweiser (+3,3%), the beer stock that raised 5 billion dollars in the second most important IPO in the world in 2019.
To follow India in anticipation of the central bank meeting which will cut rates again on Wednesday. But that day, the 150th anniversary of Gandhi's birth, will be remembered for Prime Minister Modi's announcement of the victorious end of the war against "free defecation" on the streets: 95% of homes now have a toilet.
CHINA GOES ON HOLIDAY FOR REVOLUTION DAY
Obviously, the start of the celebrations for the 70th anniversary of the foundation of the People's Republic is announced more solemnly. The stock exchanges will be closed from tomorrow until 9 October.
The spotlights are already on Tien An Men Square where 15.000 soldiers will parade together with 580 tanks while 160 fighter planes will whiz across the sky to celebrate the Asian superpower. But the noise of the engines will not completely extinguish the echo of the weekend protests in Hong Kong, repressed with unprecedented violence by the police.
TRUMP WANTS TO EJECT ALIBABA FROM WALL STREET
The sword of Damocles looming over the party is the threat of exclusion from Wall Street of Chinese securities, a total of 126 with a market value exceeding 120 billion dollars. The news, launched on Friday by Bloomberg, received a mild denial over the weekend ("for now" it is not foreseen) but casts a sinister light on the resumption of negotiations between the two Big, set for Monday 10.
LITTLE ON AIRBUS: RISK OF PAYING FOR PARMESAN
Meanwhile, the alarm on trade is ringing in Europe: in the face of Community aid to Airbus, sanctioned by the WTO, Washington could today impose tariffs on European products for around 7 billion euros, affecting even more sectors, such as agri-food and so on " bad, very bad for Italian exports”, as Prime Minister Giuseppe Conte said.
A tile on the head of the government in day of the launch of the update note to the Def yesterday briefly anticipated by Economy Minister Roberto Gualtieri: approximately 30 billion which will serve to avert the increase in VAT ("the overall effect of the measure will be a reduction and not an increase") and "to settle the Papeete bill ”. But the operation did not receive the go-ahead at the majority's night meeting. According to Minister Roberto Gualtieri, raising VAT for cash payments, discounting it to credit card users, would reduce the tax wedge. "VAT cannot increase", replies Di Maio, backed up for the occasion by Renzi. The goal is to avoid the "selective remodulation" of VAT, even by resorting to a 2,2% deficit overrun.
JOHNSON DOES NOT GIVE UP, ARABIA THREATS OIL TO THE STARS
The euro traded at 1,0904 against the dollar this morning, recovering from the 28-month lows reached on Friday.
The pound is worth 1,2285 to the dollar. Boris Johnson has said he will not resign as prime minister even if he fails to secure a deal for Britain to leave the EU. Furthermore, to avoid further Brexit delay he could convince another European state to block the extension of Article 50.
Oil moved little. In an interview with CBS, Saudi Prince Mohammed bin Salman threatened an unprecedented spike in the price of oil if no country takes action against Iran.
In the US, attention is increasingly focused on the risk of impeachment for President Trump: the whistleblower, that is, the deep throat accusing the president of having asked the Ukrainian president to investigate Joe Biden's son, has made it known that he will "soon" reveal his identity to testify before Congress.
“THE TAX UNION IS NECESSARY” SAYS MISTER EURO
The attention of the markets will usually be focused on the decisions of the central banks. The last month of Mario Draghi's mandate at the ECB begins and the pressure from the hawks to condition the start of Christine Lagarde's presidency is intensifying. "But Draghi did what he needed to pave the way for the new president," commented Olivier Blanchard, the economist close to Madame Lagarde.
The outgoing president, in an interview with the Financial Times, said that "greater public spending is more urgent than ever" to avert the recession and added that fiscal union is now a necessity if Europe wants to compete with the other blocks.
FED TOWARDS NEW CUTS, EMPLOYMENT DATA ARRIVE
In the US, the debate is growing as we await the next moves by the central bank: sentiment predicts a new cut of 0,25% by the end of the year and another at the beginning of 2020. President Jay Powell will speak on Friday at an event in Washington. Other governors will speak during the week, including John Williams of New York, still grappling with the delicate management of repos, distributed in abundance to provide liquidity to the system.
The most important data, pending the decisions on rates, concerns the labor market: the September numbers will be released on Friday. According to estimates, there should be 140.000 new jobs for an unemployment rate close to 3,7%.
PIAZZA AFFARI IN 2019 AT THE TOP AMONG THE BAGS
In this context, it must be said that Piazza Affari is approaching October in conditions of great form: the list has gained 21,16% since January, at the top of the international stock exchanges, over 22 points. But it should be remembered that, if we take into account the losses of 2018, the index is still in the red (-2,5%).
TODAY THE ACCOUNTS OF MEDIASET, MAXI CLASS ACTION ON VOLKSWAGEN
Today the half-yearly campaign ends: the last important appointment is with Mediaset's accounts and, for the Star, with the week of e Price, protagonist of an exceptional rally in the last few sessions after the creation of an international network.
To follow the assembly of Trevi which will have to approve the accounts of 2017 and 2018 as well as appoint the new board.
Mediobanca is still in the spotlight in the banking sector: the Bolloré group has written down its stake in the institute by around 30 million euros but has specified that it has maintained 'significant influence' over the bank even after leaving the syndicate agreement.
Fiat Chrysler agreed on Friday to pay the SEC a $40 million fine for "misleading investors about the number of new vehicles sold each month to customers in the United States" in 2016.
Tomorrow the group, like the big names in Detroit and Toyota, will announce the sales data for September, a troubled month for the four-wheeled world. The trend in US manufacturing indices will be affected by the GM strike, the longest in decades for the auto industry.
The most gigantic class action in history kicks off in Germany: more than 400 owners of a Volkswagen are the injured party in the dieselgate lawsuit. The process, according to the company, will last at least four years.
