GREEK REFERENDUM SLOWS EXCHANGES
EU EMERGENCY SUMMIT
A relentless collapse engulfed European stock exchanges and Wall Street. The balance is dramatic, especially for Italy: Piazza Affari plunges by 6,8% to 14.928,24 points while the spread between ten-year BTPs and the bund flies to 455 basis points with a yield of 6,33%, now dangerously close to the threshold of 6,50-7% considered a "no return". In Europe the Dax loses 5, the Cac 5,38%, the Ftse 100 limits the losses with a drop of 2,21%. On Wall Street, which opens sharply down, the Dow Jones travels down by 2,15% and the Nasdaq by 2,36%.
Overwhelmed banks in Europe and overseas on fears of a risk of contagion from the Greek crisis and the EU debt. To the tensions (and speculation) on Italy risk, to yesterday's bankruptcy of the broker Mf Global under the losses of European government bonds, to the not very encouraging estimates on the growth of the OECD, an even more inflammable fuse was lit last night that could nullify the work of all these months: the shocking announcement that Prime Minister George Papandreou has decided to submit the European agreement to a referendum. In the event of rejection by the citizens, there is a concrete risk of default for Athens (the option is not excluded according to what the president of the Eurogroup Juncker also affirms).
A "dismayed" Nicolas Sarkozy and Angela Merkel have convened a meeting with the European institutions, the IMF and the Greek authorities for tomorrow afternoon in Cannes, on the sidelines of the scheduled G20. The tensions bring the quotations of the euro to the 1,365 area against the dollar on the values of two weeks ago.
BTP-BUND SPREAD AT 455 POINTS, YIELD AT 6,33%
THE MANUFACTURING INDEX DROP SURPRISE
Despite the ECB's purchases, tensions on the markets have brought Italy back under attack. The 6,33-year BTP yield reaches 455% while the spread between the 121-year BTPs and the Bund has broken through 384 basis points for the first time. Also due to the fly to quality, ie the tendency of investors to move in moments of risk aversion towards investments considered less risky which has favored the purchase of bunds. The race towards less risky investments is also causing the spread to widen today with the ten-year bonds of France and Spain which rise to 442 basis points and XNUMX points respectively. In the late afternoon, the spread between the BTP and the Bund narrowed slightly to around XNUMX basis points.
On the growth front, after yesterday's not encouraging estimates by the OECD, the ISM manufacturing index drops surprisingly in October today. In fact, the index dropped to 50,8 points from 51,6 in September while analysts were expecting a rise to 52 points. A value, the one reached at 50,8 points, which does not bode well: the threshold of 50 is in fact considered the watershed between recession (below 50) and expansion (above). Oil, which trades at 90 dollars a barrel, also fell sharply.
INTESA AND UNICREDIT SUSPENDED REDUCED
IN THE BURST THE BPM INCREASE
Downward suspensions and double-digit drops: this is the balance sheet for Italian banks which, already under stress for days due to the recapitalization requests established by the EBA, are now heavily affected by the widening of the spread between the 15,8-year BTP and the Bund, the renewed fears of contagion from the crisis in Greece (where the risk of default becomes increasingly concrete, if the country's referendum rejects the European aid plan). Intesa closed at -12,44%, Unicredit at -10,20%, Mps at -XNUMX%.
But the storm hits all European American banks: Bnp Paribas falls by 13,06%, Barclays falls by 9,50% and Credit Suisse loses 8,2% after announcing results for the quarter lower than expected and new layoffs for 1.500 employees. On Wall Street Citigroup loses 7,44%.
Bpm loses 8,16%. Yesterday the capital increase started (which will end on November 18th) and the first stop in London of the road show (rights -20,7%). Meanwhile, a note from Investindustrial specifies that “following transactions that took place on the market” Andrea Bonomi's stake in Popolare di Milano rose to 3,43% after the increase, counting the shares and option rights available. Investindustrial announced that it "intends to voluntarily and regularly disclose to the market the shares and option rights of Popolare di Milano held by it or by companies directly or indirectly controlled by it".
Insurance companies throughout Europe are also bad, in Italy Fondiaria Sai is among the worst and closes down by 11,5%. Generali hold –4,08%.
FIAT AND FIAT INDUSTRIAL COLLAPSE
BUT CHRYSLER FILES BEST OCTOBER SINCE 2007 FOR SALESE
The titles of the Fiat galaxy are under pressure. Fiat spa closes down by 9,46%, in the wake of fears affecting the entire auto sector among the most affected by a new recession. And the news coming to Lingotto certainly doesn't support the title. In an interview with Automotive News, CEO Sergio Marchionne anticipated that the sales target for 2012 could be lowered from 2,7 million to 2,5-2,6 million. Also in India, Tata Motors, Fiat's partner in the Asian country, announced that sales of Fiat cars in October fell to 622 units against 2.025 a year earlier against a 3% drop for Tata models. However, the good momentum of Chrysler continues in the US which in October increased its sales by 27%, the best October since 2007 and the 19th consecutive month of sales increase. Fiat Industrial also fell to -5,95%.
NO RISE ON FTSE MIB ON STAR
POSITIVE FOR SABAF AND BANCA IFIS
Saipem (-7,69%) is among the stocks showing the greatest losses. Edison loses 3,53% after the details of the agreement with EDF were disclosed and a takeover bid without a premium for the minorities is under way. On the Ftse Mib, no security is able to react to the declines and close
