“We have used all possible precautions to avoid a shock to the markets”. So said the vice president of the Fed, Stanley Fisher yesterday, explaining the strategy followed to get the stock markets used to the next increase in US rates. And the markets, judging by the flat performance of Asian stock markets and Wall Street, aligned themselves with the wishes of the American Central Bank.
However, the shock could come this morning from Frankfurt, where Mario Draghi will give a highly anticipated speech at the congress of European banks in the morning. It will be an opportunity to clarify the roadmap of the ECB.
Meanwhile, Asia is starting to end a positive week with some slowdowns. Tokyo loses 0,2%, but the balance of the last five sessions shows an increase of 0,8%. Same script in Hong King and on Chinese price lists. The exception is Sydney (+0,4%), which closes the best week of the last six months (+4,2%).
Wall Street was also flat: S&P -0,1%, Dow Jones -0,02% and Nasdaq -0,03%. The US stock market was mainly weighed down by companies in the healthcare industry, particularly the sector of companies that provide healthcare insurance. Unitedhealt Group lost 5,5%, marking itself as the worst blue chip.
12 BILLION BUY BACK FOR NIKE
Intel gained 3,8% after announcing a dividend increase from $0,96 to $1,04. Nike jumped 3,5% after announcing a $12 billion buyback. Rocket launch of the IPO of Square, a leading company in smartphone payment systems: +24%.
A mixed start is expected for the European stock exchanges. Plus sign for London (but by only 3 points, to 6.333), slight decreases for Frankfurt (-12 bps to 11.053) and Paris (-12 bps to 4.903).
THE EURO RECOVERS, COMMODITIES DOWN
The most surprising datum concerns the recovery of the euro against the dollar, above 1,07, and against the Asian currencies. The explanation, according to analysts, lies in the fact that the markets are not looking at the increase in the cost of money in December but at the trajectory of the increase in interest rates: on the bond market, the two-year government bond makes 0,87%: such high levels of return have not been seen since mid-2010.
The recovery of the US currency coincided with a new retreat in raw materials. Copper and iron ore are trading at the lows of 2007. Slight gain for oil: Wti +0,1% at 40,57 dollars, Brent +0,3% just above 44 dollars.
The European Stock Exchanges were positive yesterday. But in the afternoon, in the wake of Wall Street, there was a large downside of the rally, the sectors that were strong in the morning, either reduced their gains or turned negative. Commodity companies were up 0,5%, but had also gained 2,5% on the day.
The Milan Stock Exchange (+0,4%) closed in positive territory. Plus signs also for Paris (+0,3%) and London (+0,9%). Brilliant Frankfurt (+1,17%) towed by the automotive sector.
HISTORICAL HIGH FOR CAMPARI: +60% SINCE JANUARY
It is worth mentioning in Piazza Affari the all-time high for Campari (+2,5%, at 8,23 euro), achieved thanks to a performance of the stock that is clearly more robust than the average for the Eurostoxx Food & Beverage sector (+0,4%). The Italian multinational is confirmed as the best stock in the sector since the beginning of the year with an increase of 60% (EuroStoxx +25%).
Meanwhile, Luxury is recovering positions after the recent declines: Ferragamo +3%, Tod's +1,4%, Yoox Net a Porter +1,6%. Flat Luxottica, down only Moncler (-0,66%).
TELECOM ITALIA, TODAY THE INDEPENDENTS IN THE TRENCH
New hot day on the Telecom Italia front (+0,78%). In the afternoon, the board of directors of the former telecommunications incumbent will meet to deliberate on the request by Vivendi, with a 20% stake, to expand the board from 13 to 17 members to make room for 4 of its representatives.
But yesterday Assogestioni, on behalf of the committee of managers and foreign investors, sent a peremptory letter to the top management of the company which, among other things, states that "Vivendi's request ... to nominate four candidates (three of whom with executive within their group) indicated as future directors, raises some critical issues with reference to the new governance structures”.
In particular, it is disputed that Vivendi will end up "exercise an even greater influence than that deriving from the percentage of Telecom Italia's share capital in its possession, without having launched a takeover bid". Nor does it seem appropriate for the managers "to release the three candidates who carry out the functions of CEO, CFO and Chief Operating Officer in Vivendi, which operates in the same sector as Telecom Italia, from the prohibition on competition".
VOLKSWAGEN MAKES PLANS. FCA THE BEST STOCK FOR CREDIT SUISSE
Yesterday was a roaring day for the European automotive industry. Volkswagen (+4,4% to 105,9 euros) led the race. The group has announced that it will abandon the practice of five-year investment plans, started in 2009, adopting a more flexible strategy to be able to face the reflections for dieselgate. The current management plans to reduce the plan to three years and to cut the investments already planned by more than 85 billion for the five-year period.
Positive day also for FiatChrysler (+1,5%). Credit Suisse lowered its target price to 18,20 euros from the previous 18,90 euros, but the broker reiterated that FCA remains the best stock in the sector, despite a 32% increase since the beginning of the year.
EXOR AND NOT ONLY, AGNELLI BROTHERS IN THE FORE
Significant day for the two Elkann brothers. John Philip, chairman of Exor, completed the Partner Re operation. The reinsurance company's shareholders yesterday gave the go-ahead for Exor to acquire 100% of the shares, unchanged at 40,6 euros (2 euros below last week's private placement) for 137,5 dollars each. The Board also approved the payment of an extraordinary dividend of 3 dollars tied to the conclusion of the deal.
Meanwhile Italia Independent, the company led by Lapo Elkann, closed with a gain of 1,4% after a suspension due to an excess of 26,97 euros. After the results for the first nine months announced on Wednesday evening, the stock was boosted by the judgment of Equita, which confirmed the Buy judgment with a target price of 37 euros, for a potential upside close to +50%.
A2A RUNS: HOPE FOR AN EXTRAORDINARY COUPON
Terna slips in the utilities segment (-1,1%). The Energy Authority has published the new indications for the calculation of tariffs in the distribution and transmission of electricity. The regulator has introduced remuneration systems for invested capital which could lead, starting from 2018, to a drop in the profits of companies operating in the sector.
Brilliant instead A2A (+2%), on the fifth increase in six sessions: the stock reached the highest quotation since April 2010 at 1,3120 euro during trading. The market continues to reward the possibility of an extraordinary dividend.
Enel loses 0,1% the day after the presentation of the new industrial plan and the go-ahead for integration with Enel Green Power+0,5%. Investec cut the parent company's target price to 4,5 euros from 5 euros. The renewables company's stock was downgraded to Neutral by Exane.
Oil companies contrasted, Eni +0,1%, Saipem -0,5%.
BANKS, NEWS WITHIN THE YEAR ACCORDING TO SAVIOTTI (BANCO POPOLARE)
Among the banks, Banco Popolare stood out (+0,8%). By the end of the year there could be some news on the subject of aggregations, the CEO Pier Francesco Saviotti said on the sidelines of the ABI meeting on Wednesday. According to Equita, a possible merger with Ubi could result in 566 million in synergies. Assumed a 2 to 1 swap.
Unicredit +0,1%, Banca Monte Paschi -0,4%, Intesa +1%. Asset management is doing well: Mediolanum +1,2% and Azimut +1,5%. The Ministry of the Economy, reveals Reuters, has started talks with funds specialized in the management of 'distressed assets' to buy non-performing loans from banks, after the European Commission effectively blocked the project of a bad bank with a public guarantee.
