BERLIN'S PESSIMISM ABOUT THE SUMMIT SLOWS THE EXCHANGES
THE SPREAD TOUCHES 400
Once again, on the eve of an important summit, it is Germany that upsets the expectations of the markets. The Stock Exchanges, after a lively start on the expectations for an agreement capable of also increasing the firepower of the State-saving fund, all turned negative on the German no to add up the financing capacity of the EFSF state-saving fund with that of the permanent fund Esm. And on Berlin's pessimism towards an overall European agreement as early as Friday's summit. The Ftse Mib led the declines with a drop of 1,24%, the Cac dropped by 0,11%, the Dax by 0,57%, the Ftse 100 by 0,39%. On Wall Street, the Dow Jones fell by 0,04% and the Nasdaq by 0,42%.
The Italian spread rose again, reaching 400, before returning to the 388 area. Thanks to the auction of five-year German government bonds which recorded a boom in requests for 8,67 billion against the 5 available, redeeming Germany since the flop of the bund auction in November which forced the Bundesbank to intervene. The auction was successful despite yesterday's warning from S&P which for the first time questioned the German triple A and yields stood at 1,11%. Portugal also completed a successful placement today, precisely in the wake of the market's greater confidence in a solution to the debt crisis. The auction recorded double demand and slightly lower yields.
But in the afternoon the rumors arriving from Berlin reignited tensions on the markets. A German government source would have said he was "more pessimistic" than last week on a possible overall agreement at the European summit: "The discussions of recent days show that some partners have not understood the seriousness of the situation," the source commented. Shortly afterwards, German government spokesman Steffen Seibert declared: Berlin and Paris have agreed to speed up the entry into force of the ESM, to give a strong signal to the markets at the next Brussels summit, but the resource ceiling established at provision of the bailout fund will not be affected. The euro is down slightly against the dollar at 1,3395.
WAITING FOR TOMORROW'S ECB
There was no shortage of new thrusts by Sarkozy on Eurobonds: "They are the idea of those who have no ideas", said the French president in the afternoon. On the other hand, already two days ago the Merkozy couple had reiterated that "they are in no way a solution to the crisis", a no which for some left the door open to greater interventionism by the ECB. And a merciless judgment by the New York Times which rejects the Franco-German plan, which may ensure temporary stability but is destined to aggravate Europe's fundamental problem, namely the lack of growth. Waiting for tomorrow's ECB meeting to ease the pressure on stock prices from the lows of the day: the European Central Bank, in addition to cutting rates, could announce extraordinary measures to stimulate interbank credit and restart the economic recovery.
FONSAI COLLAPSES WHO LEAVES THE FTSE MIB FROM 19
ANSALDO STS, NO MERGER WITH ANSALDO BREDA
Meanwhile in Piazza Affari the banks are back under pressure: Mps loses 5,66%, Unicredit 2,42% and Intesa 2,7%. Tomorrow at 18pm, with the markets closed, the EBA will publish the final recapitalization needs of European banks. Fondiaria Sai collapses by 5,82%. The exit from the Ftse Mib which will become effective from 19 December (in his place by Salvatore Ferragamo) and the fear that the group may have to resort to a new capital increase, in the event of a negative opinion from Isvap on the capital management plan, weigh on the stock which provides for the creation of a vehicle company into which the equity investments in Rcs, Mediobanca, Pirelli, Unicredit and Mps will flow and which will be sold for 40% to Credit Suisse to raise cash. Today the top management of the group met Isvap for a discussion but press rumors believe it is probable that the Authority will express a negative opinion. An extraordinary board of directors of the group is scheduled for December 12 to evaluate alternative ways. Ansaldo Sts. sells 4,5% Today Finmeccanica specified, in relation to some press rumors, that the option of a merger between Ansaldo Sts and AnsaldoBreda "is neither being studied nor being evaluated by" the parent company Finmeccanica, "neither in any viable way".
