The conflict over tariffs continues, but the Chinese stock exchange rears its head. After the collapse on Monday (-5,8%) the Shanghai price list (+1%) recovered positions after the confirmation that a delegation from Beijing will travel to the US over the weekend. The umpteenth credit support operation launched by the Central Bank contributed to supporting the market. Hong Kong also rose (+0,6%) after the landslide at the beginning of the week (-2,8%). On the other hand, Tokyo (-0,5%) and the Korean stock exchange (-0,9%) are in negative ground, the two markets closed on Monday.
XI DOESN'T BREAK, THE CHINESE IN WASHINGTON TO TREAT
The Chinese Stock Exchanges, like Wall Street, after the initial slip, are thus trying to decipher the nature of the sudden freeze in the dialogue between the two giants. Just a diplomatic move or a deep break? Donald Trump's ultimatum to Beijing sparked different interpretations yesterday, which provoked different reactions during the day: deep red in Asia but also on Western markets. However, the climate improved during the day, thanks to the very moderate reaction of the Chinese. "It is not the first time that Trump has threatened to increase tariffs," said Geng Shuang, spokesman for the foreign ministry.
And after considering whether to cancel Vice Premier Liu He's trip to Washington, it seems that President Xi has decided to confirm it, but with the duration reduced to just one day. Crisis overcoming? Not so. In the evening, after closed exchanges, the American negotiator Robert Lighthizer said that, in the absence of news, the list of new duties on Chinese imports in force since Friday will be released today. At that point it will be difficult to stop the crisis machine. However, there will be macroeconomic effects and, probably, a long delay before reaching a global agreement.
WALL STREET RECOVERS BUT CLOSES IN RED
Hence a state of uncertainty that promises to continue throughout the week.
The scenario in Shanghai was very similar to that experienced a few hours earlier by the US markets: a start in the red, then a clear recovery from the initial tensions. In the end, the damage was limited: Dow Jones -0,25%, S&P 500 -0,45% (but in the first stages the drop exceeded 1,6%). NASDAQ -0,50%.
CHIPS, BOEING AND APPLE SUFFER
The sectors most linked to business with China suffer. Boeing drops 1,3%, Apple -1,5%. The semiconductor index falls by 1,7%.
Bond prices rose, with the yield on the 2,48-year Treasury Note falling by implication to 2,53%, its lowest in the last three weeks, from XNUMX% at Friday's close.
The dollar strengthened against the yuan and most of its Asian counterparts, but little or nothing against the euro.
Brent Oil, while down, fell just 0,1%, from -2,5% tonight.
The clash between giants continues over the fate of the Anadarko oil company (+3,8%) after Occidental, financed in part by Warren Buffett, agreed to increase the cash portion of the offer (a total of 38 billion dollars) thus overtaking Chevron ( +1% in the final).
At Piazza Affari Eni -1,7%, Saipem -2%. Tenaris -1,5%.
Gold fluctuates on parity at 1.280 dollars an ounce.
BUSINESS PLACE ALSO SUFFERS WAITING FOR THE EU REPORT CARD
The drop in the European stock exchanges was also serious, but not so large: Piazza Affari, the worst stock exchange, lost 1,6% in the final. Paris -1,18%, Frankfurt -1,01%.
Tensions over tariffs have, albeit briefly, removed the spotlight from the problems of the Eurozone. But the PMI services data, released in the morning, confirmed the fragility of the Bel Paese: a significant slowdown in the Italian figure. In essence, what the manufacturing PMI already intuited is confirmed: in April domestic demand weakened while foreign demand strengthened, which explains why manufacturing, more sensitive to the former, accelerated significantly (although remaining in contraction), while services have slowed down. A picture that makes the country vulnerable to a slowdown in global demand, especially if it suffers from a flashback of US-China trade frictions.
Against this background, the spring forecasts of the European Union arrive today, which do not look rosy for Italy: the European Commission could marginally revise the already low expectations for Italian growth in 2019 (from +0,2% to +0,1 %). The move would have a symbolic significance of no small importance, above all if it were accompanied by a request for explanations on the relevant reasons which are causing the debt repayment process to deviate. In other words, a decision to that effect by the Commission would open the door for more stringent recommendations on 5 June (ie after the European elections on 26 May), when the country report on Italy will be presented.
RISING RATES FOR BTPs, ONLY 3 POSITIVE SECURITIES
The BTPs closed a session characterized by a general aversion to risk with a minus sign. In closing, the spread between the Italian 257-year bond and the Bund stood at 259 basis points, from 253 at the start and from 2,58 on Friday evening. The 2,55-year yield is around XNUMX% after closing at XNUMX% the previous session.
On the stock market, only 3 out of 40 stocks closed with a plus sign: Campari, Snam and Terna, or the defensive trio par excellence.
CNH AND STM UNDER FIRE, EXOR ALSO SUFFERS
The black jersey is shared by Cnh Industrial (-4%) and Stmicroelectronics (-4,8%). The rest of the automotive sector is also bad: Exor and Pirelli -3%.
Brembo-3,5%: the board of directors has appointed the new chief executive officer, Daniele Schillaci, a former Nissan manager.
Fiat Chrysler (-2%) and Ferrari (-2%) limit the damage.
BANKS IN HOLDING, NEW CFO FOR TIM
Banks down sharply under spread pressure. The big Intesa and Unicredit lost 1,4% and 3,27% respectively. Mps leaves 2,8% on the ground.
Tim is doing better: the former Unicredit manager Giovanni Ronca will assume the role of chief financial officer, taking over from Piergiorgio Peluso from 17 June.
Weak luxury: Ferragamo -3,5%, Moncler -2,2%.
In the rest of the list, Safilo closed in positive territory (+1,5%) e
Aviation (+1,7%).
