Who will be right between Warren Buffett and George Soros? The wise man from Omaha bet a billion dollars on Apple, convinced that the stock markets give good guarantees. On the contrary, the philosopher financier is betting on the downside, not excluding an epochal crisis: as a result, he sold 2,1 million options on the Spdr, a "bear" fund that multiplies the effects of the decline in the S&P index. And he took refuge in gold, buying up ETFs on the yellow metal and mining shares. The challenge between the two has just begun. For now he only demonstrates that the horizon is so confused as to put the old foxes of the markets in difficulty.
A positive signal arrives this morning from Tokyo. In the first quarter, Japan's GDP rose by 0,4% (1,7% on an annual basis), better than forecasts thanks to the drive for recovery in consumption after the slump at the end of the year. But the figure does not take into account the effects of the April earthquake which devastated car components and electronics. The Japanese Stock Exchange (+0,6%) advances cautiously, the yen slightly down. The market is therefore still betting on a package of measures to boost growth. The other stock markets in the region fell on the back of Wall Street's decline: Hong Kong -1,6%, Shanghai -1,7%, Shenzhen -2,4%.
US INFLATION RISES, WAIT FOR FED MINUTES GROWS
The negative signal comes from Wall Street: Dow Jones -1,02%, S&P -0,94%, Nasdaq -1,25%. Tipping the balance on the pessimistic side are the moods filtering through the Fed, pending the publication, tonight, of the minutes of the last meeting of the central bank. Several central bankers are not ruling out an upcoming rate hike. The hypothesis gained ground after the data on consumer prices, which rose by 0,4% in April, the most significant increase for three years. Another sign of an acceleration of the recovery comes from the construction sector. In April, 1,17 million new construction sites were started, up 6,6% on the previous month.
To corroborate the thesis of an imminent trend reversal "Bear", then contributes a shower of statements by central bankers. "An increase in June could be justified," said Dennis Lockhart of the Atlanta Fed, in agreement with John Williams (San Francisco) and Jeffrey Lacker (Richmond). Janet Yellen is unlikely to bow to these pressures at the June meeting, but the market recognizes that the turning point is approaching.
OIL STILL CLOSE TO 50 DOLLARS
But the bullish front has a good card to play: the recovery of oil. Crude oil, despite a correction from the highs of the session, remained close to the highs of the last seven months: Brent is on parity at 49 dollars a barrel, Wti at 48,06 dollars (+0,7%). In the last eight sessions, the WTI has risen by 10%.
On the corporate front, the new decline in Lending Club, the peer-to-peer platform that connects those who want to sell debts and those who want to take them over, should be noted, down by 9% to 3,61 dollars, the minimum since the listing, which took place at the end of 2014 at 15 dollars. The stock lost 51% last week, a plunge triggered by news of the firing of CEO and founder Renaud Laplanche.
BLACK JERSEY NEW BUSINESS PLACE
The stock markets of the Old Continent have marked time, held back by the moods of Wall Street. Paris (-0,3%) and Frankfurt (-0,6%) fall back, only London (+0,27%) is positive. Once again Piazza Affari, which received the black jersey, did worse: -1,3%, the Ftse Mib index at 17.498. The simultaneous descent of banks, luxury and automotive has weighed. Oil companies contrasted: Eni -0,8% and Saipem -0,9%, while Tenaris rose by 2,2%.
THE TREASURY LAUNCHES A NEW 5-YEAR BTPEI. THE EU PROMOTES THE MANEUVER
On the macro front, the formal go-ahead from Brussels to the Italian stability law is arriving today. Yesterday the response of the college of European commissioners was delivered to Rome: the European Commission has recognized Italy with flexibility of around 14 billion euros on the 2016 budget, substantially accepting the requests of Matteo Renzi's government. But the picture is less rosy if we look at 2017, the year in which the Commission sees the need for an adjustment of between 0,15 and 0,20% of GDP. Meanwhile, Istat has lowered the forecast for the Italian GDP for the current year to 1,1%, from the 1,4% estimated last November.
In the meantime, the debt market is positive: the Btp/Bund spread narrows to 132, 3 points less than the previous day. The yield of the Btp 10 settles at 1,473%, taking advantage of the hunger for paper for securities in the periphery of the eurozone. In the meantime, the Treasury has mandated a syndicate of banks to place a new 5-year Btpei indexed to inflation in the euro area. The structure of the new bond, which expires on May 15, 2022, will follow that of the Btpei issued so far, with the only difference being that the coupons will be paid in the months of May and November. The syndicate of banks is made up of Banca Imi, Nomura, Royal Bank of Scotland and Ubs.
CAR, RISK OF BILL IN THE USA. FCA (-6,6%) LOSES THE MOST OF ALL
Fiat Chrysler is back in the sights (-6,6%), the weakest stock on a difficult day for the four-wheeler sector (Stoxx index for the sector -2%). A double tile hit FCA yesterday. In the morning, Exane BNP Paribas decided to cut the recommendation to Underperform, setting a target price of 5,40 euros in the belief that an imminent slowdown in the US market, which has been on the rise for seven years: the leasing sales bubble, warns the broker is about to explode.
Meanwhile HSBC has downgraded the European sector to Underweight from Neutral fearing a trend reversal in the auto market in North America, where the group produces about 90% of operating profit.
Exor lost 2,8%, Cnh Industrial -2%. The other European stocks in the sector were also heavy. Peugeot (-4,10%) and Renault (-3,05%) suffer in Paris. The state could put a stake in the two groups up for sale. Volkswagen fell by 2,6%, BMW -3%.
UNICREDIT IN THE SIGHT. THE COMEBACK OF BPM-POPOLARE FADES OUT
Banks still under pressure. Unicredit (-1,9%) in the sights: the hypothesis is gaining ground that the president Giuseppe Vita would have received a mandate from the main shareholders to explore possible solutions to improve the governance of the Bank, accused after the decision last September to provide the guarantee on the capital increase of Popolare di Vicenza without going through the board. The replacement of the CEO Federico Ghizzoni could also be on the table.
The betrothed of credit suffers again: Banco Popolare -6,5% and Banca Pop. Milan -5,4%, the two institutions that yesterday illustrated the merger project. Stocks have been subject to sharp swings. From the initial rebound that pushed the quotation up to 4,7880 euros, the bank led by Pier Francesco Saviotti finished with a drop of 6,7% to 4,3020 euros, also confirming itself as the worst blue chip since the beginning of the year (-67 %). Similar script for the institute in Piazza Meda: in the initial stages the stock had gone as far as 0,5515 euro, the daily excursion exceeds 10%.
Morgan Stanley has found that the cost-cutting foreseen in the industrial plan post-merger of the two institutions is insufficient to cover the cost of capital after the erosion of revenues seen in the last six months. The broker has raised the rating to Equalweight from Underweight on Banco Popolare (target price at 6,40 euros from 9 euros against a currently 36% lower quotation). Su Bpm rating lowered to Equalweight by Overweight. KBW instead cut the target price to 0,65 euro from the previous 0,75 euro.
Intesa Sanpaolo closed down by 0,7%, at 2,184 euros. From the communications to Consob on the relevant shareholdings it emerges that BlackRock has grown to 6,3% of the capital from the previous 5%, thus reinforcing the second place behind the San Paolo foundation which owns 10%.
MEDIASET AT THE TOP. RCS: CAIRO WON'T LEAVE BUT IT HAS NOT DOUBLE
Great ferment in the world of communication. Mediaset (+3%) was the best blue chip in Milan, thanks to the data on advertising sales released yesterday by Nielsen Research, which suggest a positive second quarter. Mediobanca Securities confirmed the stock among the top picks in the Italian media sector, with an outperform rating and a target price of 5,13 euros. Berenberg instead confirmed the buy recommendation. According to analysts, the stock is too undervalued.
Rcs added a further +3,1% after yesterday's leap reaching 0,715 euro, above the 0,7 euro of the takeover bid by Carlo Bonomi and old partners. The board of directors of the publishing house has been convened on Friday, which will also have to examine the takeover bid as a preliminary step. No official statement from Urbano Cairo. But the publisher does not seem intent on relaunching his Ops or backing down, despite the fact that the consortium's cash offer appears higher.
Telecom Italia lost 2,6% in contrast with the rest of the sector at European level. Rbc confirmed the Outperform recommendation, reducing the target price to 1,25 euro from 1,30 euro.
LUXURY, JP MORGAN SEES BLACK. RBC FERRAGAMO SIZE
Significant discounts in the Luxury sector. A JP Morgan report notes that the first quarter for the sector went worse than expected, and there are no signs of improvement for the second. The worst stock was Ferragamo, which lost 3,9% to 20,42 euros. Yesterday Rbc reiterated the Underperform recommendation, with a target price of 19 euros. Together with that of Ubs (Sell, target 19 euros) it is the most severe opinion expressed in the panel of 24 analysts surveyed by Bloomberg.
Yoox-3,8%, Moncler -2,2%. Safilo rebounded (+1,53%) after the announcement of the early renewal of the licensing agreement for the design, production and distribution of the Jimmy Choo branded collections of sunglasses and optical frames. Banca Akros analysts welcomed the news and confirmed the neutral recommendation and the target price of 10 euros on the stock.
ISAGRO SHINES AMONG THE STARS (+15,4%)
Isagro's performance in the Star index should be noted: +15,4% to 1,990 euro after the results of the first quarter. Banca Imi judged the accounts positively and confirmed the buy recommendation on the stock and the target price at 1,97 euros (already exceeded with yesterday's leap).
