The euro is under fire this morning after the decision of the German liberals to interrupt negotiations with the Greens and the Cdu for the formation of Angela Merkel's new government. At this point the most probable hypothesis is that of early elections. Angela Merkel, after 12 straight years as chancellor, could try to form a minority government of the Christian Democrats. The single currency traded this morning at 1,172 dollars, the sharpest drop in the last month, and also slowed against the pound (0,8885, with a drop of 0,4%).
WEAK START FOR SHANGHAI AND TOKYO
Contrasted start of the financial week also for Asian lists. The Japanese stock market is weak, held back by disappointing data on the trade balance: Tokyo's exports slow down (+14% in the first ten months against a forecast of +15,8%), while a new stage in the Toshiba crisis is taking place, forced to a new capital increase.
Chinese markets were also slowing: -0,8% Shanghai, weighed down by the stricter rules on the issue and distribution of financial products announced on Friday by the Central Bank. Hong Kong is up slightly thanks to Tencent (+1,2%). Alibaba, imitating Amazon, announced its landing in hypermarkets by purchasing a stake in Sun Hai for 3 billion dollars.
Oil also struggled: Brent is at 62 dollars a barrel, yielding part of Friday's gains (+2% to 62,60). However, the week ended in the red: the opening of new shale oil plants in the USA and the uncertainty about the producers' meeting in Vienna in a week's time weigh on the markets. Russia may not agree to the renewal of production cuts requested by Saudi Arabia.
Gold is at a month-long high, at $1.292.
THANKSGIVING CHRISTMAS BAGS
Half-service bags during the week for the Thanksgiving holiday. Wall Street and the Japan Stock Exchange will be closed on Thursday. On Friday, the US stock exchanges will only work half a day.
Attention therefore shifts to Black Friday, the traditional start day for Christmas shopping, which will involve at least 115 million potential buyers. However, in direct competition with Cyber Monday, the American response to the sparks of the Chinese Single's Day (4,5 billion in turnover on Alibaba's portals).
TODAY DRAGONS IN THE HAWK ARENA
In Europe, the spotlight is on today on Mario Draghi's hearing in the European Parliament. It will be the occasion for a harsh and direct confrontation with the deputies, especially the Dutch, strongly hostile to Quantitative Easing. Several members of the ECB's board will speak during the week: Nowotny, Lautenschlaeger, Jazbac, Makuch, Rusnock and Constancio.
On the central bank front, the publication of the minutes of the last meeting of the Federal Reserve should be followed on Wednesday, an important indicator in view of the meeting of the monetary committee in December, the occasion for the probable increase in rates.
CARIGE INCREASE KICKS OFF ON WEDNESDAY: NEW SHARES AT 0,01 EURO
Piazza Affari restarts after the first week in deep red (-2,1%) thanks to the delicate crisis situation in Banca Carige. At least on this front, however, the worst seems to be behind us.
This morning the sword of Damocles of the risk of yet another insolvency of an Italian bank will not weigh on the banking sector of Piazza Affari, because in extremis, in the night between Friday and Saturday, an agreement was reached on the capital increase of Carige at unit price of 0,01 euro: Vittorio Malacalza, Gabriele Volpi and Aldo Spinelli will do their part, the guarantee consortium, strengthened by Equita, as well. Lastly, Banca Carige entered into exclusive negotiations with Credito Fondiario for the sale of a portfolio of non-performing loans amounting to 1,2 billion euro. Banca Carige intends to start the exercise period of the option rights on Wednesday 22 November and end it on Wednesday 6 December 2017.
The no less serious issue of Credito Valtellinese remains standing, but the risk of a new systemic crisis is receding. Consob has banned short selling on the stock for today's entire session. Moody's, meanwhile, cut its deposit rating to 'Ba3' from 'Ba2', with an evolving outlook.
THE MPS CASE TO THE BANKS COMMISSION
However, the strain on credit shows no signs of abating. The "father" of the crisis takes the stage of the commission of inquiry: Monte Paschi. In addition to the new confrontation on the Veneto banks, there will be another round with no holds barred between the general manager of Consob, Angelo Apponi, and the head of the banking and financial supervision department of Bankitalia, Carmelo Barbagallo, dedicated to the crisis of the Tuscan institution.
In the meantime, the deadline for the presentation of the lists of directors expires on Wednesday. CEO Morelli and President Falciai should be reconfirmed at the top, but some discontent is growing around the choice of the latter, especially in one part of the Democratic Party: in short, the parties continue to lay down the law in the Treasury subsidiary.
BUDGET LAW, THE EU REPORT CARD ON WEDNESDAY
If successful, the assignment to Milan of the European Medicines Agency, under discussion today in Brussels, could help to calm relations between Italy and Brussels. Up for grabs is the arrival of 900 high-income employees as well as events and demonstrations involving around 70 participants a year, for a turnover of 1,7 billion euros.
But the climate could heat up on Wednesday, when the opinions of the EU executive on the budget law arrive, from which a first critical signal will emerge in this sense, even if the actual judgment will not arrive before next spring.
Tomorrow, however, the Senate Budget Commission will start examining the entire package of government amendment proposals to the manoeuvre. The goal is to get to dismiss the measure in time and allow the arrival in the Chamber on 27 November.
TODAY THE MEDIOBANCA DIVIDEND AND FIVE ADVANCE COUPONS
The Mediobanca dividend (0,37 euro) arrives today at Piazza Affari. Five other companies detach an advance coupon: Atlantia: (0.57 euro), Recordati (0.42), Tenaris (0.013), Terna (0,0742639 and Banca Mediolanum (0,2).
