Sos, Tokyo falls. Thanks to the new estimates on global growth (corrected downwards from 2,4% to 2,2%) by the World Bank, the Japanese Stock Exchange suffered a collapse of 6,35%. Meanwhile, the yen rallied against the dollar to its highest levels in two months. Yesterday evening the American Stock Exchange experienced a significant decline. The Dow Jones index falls by 0,71%, S&P -0,82%, Nasdaq -0,97%. It is the third consecutive fall for Wall Street which has lost 1,7% since Monday. All ten sectors of the Standard & Poor's index closed lower.
The markets are thus preparing for the possible cut in QE, i.e. the Fed's purchases on the markets. In reality, the exit from the Financial Repression is already underway: since last Tuesday, the yields paid on US bonds have once again exceeded the level of inflation. Hence the tug of war between optimists and pessimists. The latter fear the encore of 1937, when the premature end of the stimulus measures plunged the USA back into crisis. Optimists reply that the economy is now able to walk without crutches, and markets will soon reward the recovery.
ITALIAN RATES GO UP. SOCGEN: MADRID BETTER THAN MILAN
The spread, in these weeks, in these coming weeks will fluctuate between 270 and 310 basis points. The guru's word to the Reuters agency: “The markets are still conditioned by expectations of a reduction in US Quantitative Easing. We have to get used to this transition phase, which will not be long in any case, which should be followed by a recovery of the markets on the basis of the improvement of the economies". As long as Italy joins the recovery convoy, it should be added.
Meanwhile, today a new trial by fire for the Treasury which yesterday placed 7 billion BOTs, with yields jumping to 0,962% compared to 0,7% in May. At 11 am the following are on the scene: 2,5-3,5 billion three-year BTPs, 1-1,5 billion over 15 years, plus 2-3 billion Ccteu over five years.
Meanwhile, a disturbing signal comes from Société Générale. A negative report from the Parisian institute kicked off the sales on Italian institutes on Monday. Yesterday Socgen compared the Spanish banks after the cleaning of the balance sheets and those of our house. The result? Madrid Stock Exchange +0,34%, the best, Milan -1,61%, the worst.
EUROPE IN RED. ATHENS SHAKES AGAIN
The lists of the stock exchanges of the Old Continent are down sharply: London -0,6%, Paris -0,4%, Frankfurt -0,9%. The credit giants fell: Société Générale, Barclays and Deutsche Bank all three lost more than 2%. The Greek prime minister's decision to shut down state television has triggered very strong tensions within the coalition that supports the government in Athens. There is once again fear for the country's political stability and rumors are once again circulating on the market of another possible restructuring of the Greek public debt. The Athens Stock Exchange lost 3,2%.
Finally, from Karlsruhe comes Jens Weidmann's lunge. Before the German Constitutional Court, the president of the Bundesbank declared his intention to introduce clear limits to the ECB's freedom of action, a request that would require a modification of the bank's founding treaty.
BITTER BUSINESS PLACE FOR BANKS AND FIAT
In Milan, the strongest losses are from the cooperative banks: Pop.Milano -4,7%, Ubi -4%, Banco Popolare-3,7%. Unicredit fell by 2,5%, Intesa -2,3%, MontePaschi -4,6%. Other strong decreases concern Fiat -3,7% in braking together with the rest of the European automotive sector -2%. Ubs cut the recommendation on Fiat to Neutral from Buy and raised the target price to 6 euros from 5,5 euros. For UBS, in light of the run of Ford and GM shares in the last two months, the estimated costs for the purchase of the Veba share in Chrysler rises to 4,5 billion dollars. But "almost regardless of the terms of the agreement - continues the note - Fiat will need to strengthen its capital base".
Citicorp, on the other hand, has removed the Ingot from the list of securities to avoid. Buzzi closes down -2,4% to 12,48 euros after having achieved a maximum of 13,15 euros: in the morning Morgan Stanley had raised the recommendation to "equalweight" from "underweight", the target price rises to 12,70, 10,40 euros from 3,4 euros. Italcementi -1,2% and Cementir -XNUMX% are also bad.
Among the stocks in positive territory, Ansaldo StS +1,4%, Autogrill +1,4% and Luxottica +0,7% stood out. Good rise for Campari +1,5%, stock considered anti-cyclical. The Rcs rebounded (+16%) after the weakness of the last few sessions and while awaiting the price of the securities that will be issued for the capital increase operation which will start on Monday.
