While awaiting communications from the Federal Reserve tonight at 20pm, the stock markets are distracted with the quarterly reports. Meanwhile on Wall Street the clash is taking place between the traditional masters of the market, led by large brokers, and the troops of Reddit, one of the sites where the thousands (or tens of thousands) of traders are concentrated who, financed by federal aid against the crisis, are turning the market upside down, fueling the bubble risk. The latest battleground is GameStop, an electronic game retailer up 92,71% after Monday's 144% jump. A painful reckoning looms.
Meanwhile, the stars of technology shine again with the counts. The triumphal march was inaugurated yesterday by Microsoft: +5,2% after the Stock Exchange. Buoyed by booming personal computer purchases and the success of the cloud by businesses and individuals, revenues rose 17% to $43,1 billion, analysts had expected to increase by less than 10%.
THE PANDEMIC HOLDS BACK STARBUCKS AND AMERICAN EXPRESS
However, the effects of the third wave of the pandemic are being felt. The use of credit cards for dinners and travel decreases, to the detriment of American Express profits (-4,13%). Starbucks lost nearly 5% after releasing preliminary sales data. The wait is now focused on the numbers of Apple, which tonight could announce a turnover of over 100 billion dollars.
The indices are flat: Dow Jones -0,07%, S&P 500 -0,15%, Nasdaq -0,07%. Dow Jones futures are down this morning: -0,4%. The price list of technology bounces back. In other words, with the pandemic on the rise, the economy of the stay home (electronic, IT, social) to the detriment of thego out (transport, shopping, banks).
CHINA LIMITS TRAVEL FOR NEW YEAR
In Asia, the Nikkei index is up by 0,3%, the Hang Seng by 0,2%, the CSI 300 index of Shanghai and Shenzen by 0,3%. China recorded the lowest number of new infections since January 11, only 77. It seems that the Beijing authorities will limit travel as much as possible for the lunar new year holidays, starting in early February: the Ministry of Transport he intends to cut the trains in circulation by 40%.
Brent oil was up 0,5% to $56,3 a barrel. The American Petroleum Institute (API) estimates a decline in US crude inventories of 5,3 million barrels.
Euro-dollar at 1,216, little moved: the Italian crisis, for now, has no effect.
THE CRISIS DOESN'T STOP THE BUSINESS MARKET (+1,16%), SPREAD TO 117
In fact, the markets think like Fitch: the rating agency believes early elections are unlikely, given that the centre-right emerges as the winner from the projections. On the international front, another note arrives that defuses the situation. IMF forecasts released today signal that the US economy will emerge from the pandemic stronger than before; same forecast for China.
In this context, the investment houses have suspended the judgment on Italy. "The phase of political instability - underlines Kepler Chevreux - comes at the wrong time, but the probability of early elections remains very low, even in the current context".
“Snap elections are still seen as unlikely,” Deutsche Bank pundits added. As a consequence, the spread fell to 117 basis points, from 122 yesterday, confirming that the market seems to focus on a new assignment to Giuseppe Conte.
Piazza Affari stops at the threshold of 22 thousand points (21.987), closing up by 1,16%.
IMF: IN 2021 GDP GROWTH OF ONLY 3%
The recovery for Italy, according to the IMF, will stop at 3% (against the +5,2% expected in October). A relatively modest rebound when compared with estimates of a 9,2% drop in 2020 (previous estimates were worse: -10,6%). The trend should improve in 2022 (+3,6%, against +2,6% in October).
In the rest of Europe, Frankfurt rose (+1,66%); Paris (+0,94%) and Madrid (+0,78%). London lagged behind (+0,21%), also due to the leap in the pound, in a context of greater propensity for risk and a weakening of the dollar.
Note the performance of Ubs: +2,40% in Zurich after announcing a buyback for 4,5 billion dollars.
Linde, the Anglo-German-American industrial gas giant, has also raised its dividend and announced the buyback of shares for six billion dollars.
LVMH +1,2%: BIG BRANDS IN RECOVERY
LVMH (+1,22%) reported a 3% decline in sales in the fourth quarter, in line with estimates, thanks to a boom in revenues from major brands such as Louis Vuitton which offset the weak performance of duty free shops. In the fourth quarter, LVMH recorded sales of €14,3 billion.
TODAY THE AUCTION BOT, BOND FROM SLOVENIA AT 60 YEARS OLD
The good tone of the BTPs is reflected not only in the spread but also in the purchases of Italian paper on the eve of the month-end auctions.
The yields of the six-monthly Bot (in auction today) are expected to rise, which at the end was quoted at -0,43% from -0,52% of the December placement, when it had reached a new all-time low.
Austria and Greece have mandated a pool of banks to issue a new 10-year government bond, while Slovenia a 60-year one.
ORCEL EFFECT ON UNICREDIT: +4,15%
His desire to restart is such that, it seems, Andrea Orcel, already defined as the Cristiano Ronaldo of investment bankers, has offered to work for free in his first year at Unicredit (+4,15%), in case the board of directors institute in piazza Gae Aulenti confirms today its appointment to succeed Jean-Pierre Mustier. The games are made: Orcel, supported by Leonardo Del Vecchio and by the two Cassa Torino and Verona foundations, prevailed over Fabio Gallia. It is probable that the Italian government crisis has offered the opportunity to proceed with the appointment, limiting the political pressure for a merger with Monte Paschi, appreciated by the Pd (and by the new president Padoan), but disliked by Del Vecchio, the main shareholder of the institute. Siena will be the first dossier on the desk of the 57-year-old Roman banker, who has a lawsuit pending for 100 million euros, requested as compensation for damages for the failure to lead Banco de Santander after Orcel left his position at Ubs . However, the dispute would be in the process of being resolved and the agreement could close with a check for 47 million for Orcel, who will thus be able to allow himself the luxury of working the first year for free (or almost).
Also up was Popolare Sondrio (+4%), Bper (+2,78%), Mediobanca (+2,41%), Banco Bpm (+1,57%). Little moved Mps (+0,19%).
GENERALI, TODAY THE AFTER DE COURTOIS
Generals +1%. Francesco Gaetano Caltagirone has rounded up his stake to 5,4%. The Trieste board of directors is set for today and will have to approve the new managerial structure in the light of the resignations of the general manager, Frédéric de Courtois, and of the chief investment officer, Thimoty Ryan: key men of the group CEO, Philippe Donnet, who are about to leave the group.
Positive day also for Nexi, which closes trading up 3%. After the losses on the eve, the industrialists recovered: Pirelli +3% and Leonardo +2,92%.
GOLDMAN SACHS PROMOV SAIPEM
Saipem (+1,96%) among the best stocks. Goldman Sachs raised its target price from 2,4 to 2,8 euros, confirming the buy recommendation. The target price rises due to the shift in valuation from 2020-2022 to 2021-2023. However, the ebitda estimates are lowered by 6% on 2020 and 8% on 2021 to reflect a greater impact of Covid-19 on profitability. The positive judgment from analysts has come to drive the stock. Goldman Sachs has raised the target price to 2,80 euros.
Tenaris is also advancing (+1,7%). Goldman Sachs lowers the judgment to neutral, target price at 7 euros.
PRYSMIAN BLACK JERSEY, PIAGGIO CELEBRATES THE NEW RANGE
The black jersey for the day goes to Prysmian (-3,8%), which placed equity-linked bonds for 650 million euros and repurchased outstanding bonds for 250 million.
TODAY THE GOODBYE TO FINCANTIERI/STX
Little move Fincantieri, on the eve of breaking off negotiations with the Chantiers de l'Atlantique. The project to create the Airbus of the sea broke down on Parisian resistance.
In the light of Cementis (+7,65%): Kepler Cheuvreux raised the target price from 8 to 8,4 euros, confirming the buy recommendation. Money also for Piaggio (+3,39%), which celebrated the presentation of the new range of four-wheeled light commercial vehicles.
