FONSAI-UNIPOL, AN INDIgestible BITE
CLOUDS FROM LISBON COMING FOR THE EURO
The skies of Brussels, the capital of Europe blocked by the general strike, are covered with gray if not black clouds.
Le European Stock Exchanges, as the gigantic summit of the Old Continent's premiers gets underway, they are dominated by worries about sovereign debt: in Milan the Ftse Mib index drops by 1.08% to 15.774. The others are also down European stock exchanges: London -1,1% Paris 1,52-%, Frankfurt -0,94%. I don't like the umpteenth, perhaps not least, tug of war on the Greek debt, while the ranks of those who believe that sooner or later the Athens default. Meanwhile, Portuguese 26-year yields jumped 15,54 basis points to a ceiling of 21,44% while the five-year yield is at 104%, an increase of XNUMX points. The spread between Portuguese bonds and the German bund it widens to 1.420 points and the yield on the ten-year Lusitano leaps to a record 16%. The country's credit default swaps also rose sharply. According to CMA data, the cost of insuring 10 million dollars of Portuguese sovereign debt over the next five years has shot up to 3,95 million dollars, to be paid in advance, plus another 100.000 dollars to be paid annually.
In short, even before it closes the Greece chapter the tragedy of Lisbon breaks out: the market, judging by the CDS, gives 71% the probability that Portugal will have to move towards default.
The non-negative result of theItalian auction. The Treasury, in order to confirm the drop in yields, had to give up its ambition to place all the bonds it wanted. 3,57 billion euro of BTPs maturing in 2017 and yielding 5,39% were placed (bid to cover 1,28 and target of 4 billion euro). Also placed 2 billion euro of Btp maturing in 2022 with a yield of 6,08% (bid to cover 1,40% and target of 2 billion euro). Finally, 1,85 billion euros of BTPs maturing in 2016 and 2021 were placed: a maximum target of 2 billion euros.
The yield of the 10-year BTP on the secondary market shows an increase in yields by 23 basis points to 6,089%, the 5-year rate is at 5,10% (+32 basis points). The spread remains above 430 bp.
The deal of the year, that is the insurance “merger” between Unipol and the Ligresti group companies causes this reaction in Business Square: Fondiaria-Sai lose 8,3%, Unipol first reduces the increase to 0,6%, then slips into negative territory -3,8% Premafin is unable to set the price and remains suspended due to an excessive decrease (-32%). Milano Assicurazioni is down by 8%. Weigh the increase in losses of the former Ligresti insurance hub. Investors don't mind the news that the money invested by the Bologna-based company is destined to all end up in the companies involved in the pole. On the eve of the board meeting, the first after the successful outcome of the capital increase, Unicredit dropped 2,36% after a long up and down throughout the session. This morning Citigroup raised the target price to 4,65 euros from 4 euros, the recommendation remains buy.
Intesa Sanpaolo -2,21% Banco Popolare it plummeted in the afternoon by 5,5% closely followed by Banca Pop. Mi -5,92%. Ubi -3,36%. Generali is down 1,69%. Lottomatica + 1,3% Pirelli + 0,64% Impregile it +1,07% ed Enel +0,06% are the earnings of assets in the main basket +0,06. Title unchanged Fiat -1,04% on the eve of the board meeting on the 2011 accounts set for Wednesday. Heavy bloodletting of Finmeccanica below 6,69%.
