The latest data on the American economy on consumption and industrial production for August (-0,4% against expectations of -0,2%) signal a slowdown in growth. A weak indication, but one that convinced the markets that the Fed, starting today in conclave in Washington, will postpone the rate hike. Hence the rise in the price lists which, however it turns out, are celebrating the end of a long phase of uncertainty (which the markets hate). In addition, there seems to be a growing sense among investors that whatever Yellen does, she will find a way to calm the markets, as she has done on the vast majority of previous occasions.
Hence the positive reaction of the stock markets, which however does not involve currencies: the exchange euro Dollar sees the US currency strengthening to 1,126, in contrast to a scenario of unchanged rates. Also declining yen, Indian rupee and Hong Kong dollar. On the bond market, meanwhile, the ten-year Treasury yield closed at daily highs at 2,25% and that of the two-year Treasury at levels not seen since 2011 at 0,78%.
A New York the Dow Jones index and the S&P 500 appreciated by 1,4% and the Nasdaq by 1,1%. Positive session also a Tokyo. The Nikkei index advanced by 1%, driven by the brilliant performance of the car: Honda +4,4%, Toyota +2,6%, Nissan +2,7%. The Chinese Stock Exchanges moved little, after two days of sharp declines (-6,1%). Shanghai scores +0,1%, Shenzhen +1,5%. Hong Kong +1,2%.
MILAN LEADS RECOVERIES. SOON THE 15 YEAR INDEXED BTP
The bull appeared in Europe in the afternoon, on the wave of Wall Street's optimism, erasing the effects of the slowdown in the Zew index, relating to German confidence and, above all, the effects of the news (later denied) of a heavy increase in nuclear disposal charges for the German Rwe and E.on.
The Milan Stock Exchange accelerated in the final session, the FtseMib index thus closing up by 1,6%. The other European markets are also positive, but record more contained gains: Paris +1,1%, Frankfurt +0,5%, Madrid +1%.
The head of Italian public debt management Maria Cannata reiterated that the Treasury is closely monitoring the market in view of the issuance of a new 15-year Btpei, while this year there will be no placement of a second Italy Btp. The stop is linked to the good performance of funding, which makes a new use of this tool superfluous. But you still underlined that the Btp Italia is not a product that will diminish in the coming years.
BANKS OK, MPS HUNTING FOR A PARTNER (WHICH ISN'T THERE)
Many positive ideas in a lively meeting (but with reduced volumes). The rebound of the banking sector, in particular, explains the good performance of the index. After 37 months of decline, the trend in loans to the economy by the Italian banking system turned positive again, registering, at the end of August 2015, +0,3% year on year for the private sector and +0,6% for the entire Italian system.
The two main banks are making progress: Unicredit +2,4% and Intesa +2,1%. Pop Bank. Emilia +2,5%. Monte Paschi +1,76%. Massimo Tononi has been the new president of Banca MPS since yesterday and will remain in office until the approval of the 2017 budget. It will be up to him to identify a partner in view of a merger that does not seem on the horizon for now.
The CEO Fabrizio Viola, during the meeting, said that "to make an aggregation it takes two, until there are concrete options we will continue to work as we are doing". Viola thus reiterated that the choice to move towards an aggregation is not only a request from the ECB, but also a choice made by the Board of Directors in 2014. "We have not changed course", he concluded. The stock has lost 7% since the beginning of 2015.
Azimut up (+3,1%). Generali +0,5% to 16,32 euros. The insurance company completed the sale of the subsidiary BSI (Bank of Italian Switzerland) to the Brazilian Banco BTG Pactual. In line with the terms of the agreement signed on July 14, 2014, the final consideration for the sale is equal to 1.248 million Swiss francs, consisting of approximately 1 billion francs in cash and the remainder in equity instruments of BTG, listed on the Sao Paulo Stock Exchange. The transaction strengthens the group's Solvency I ratio by 8 percentage points to 164%, and the pro-forma internal model Economic Solvency ratio by 8 percentage points to 200%, both calculated as at 30 June 2015. The sale of the bank also significantly reduces Generali's non-insurance business.
THE GERMAN NUCLEAR PROVIDES A BLACK MORNING FOR ENEL, WHICH IT RECOVERS
On the European Stock Exchanges, the best sector was that of oil stocks (Stoxx +1,3%). In Milan Eni rose by 2,2%. Great leap for Saipem (+4,3%). Tenaris (+2,8%) recovers lost ground on Monday (-1,7%). Kepler-Cheuvreux intervened on the stock and started hedging with a Buy recommendation and a target price of 13 euros. Saras' race also resumes (+1,9%).
The utilities sector is very agitated. The sector has been thrown into turmoil by the collapse of the big Germans in the sector: Rwe and E.On have come to lose more than 10% falling to new historic lows after the news, published by Spiegel, that the two companies will have to invest an additional 30 billion for the disposal of nuclear waste. The news was later partially denied. Rwe limited the decline to -3,8%.
In the morning the sales "for sympathy" had also hit Enel (minimum at -2,5%) which then corrected its course closing at +0,84%. Enel Green Power also performed well (+1,9%) which, with a powerful rebound from the lows of the morning, recovered more than 5 percentage points.
SALES GROW IN EUROPE, FCA SPEEDS UP
The good sales in Europe and the news coming from the Frankfurt show are pushing the automotive sector. Fiat Chrysler +2,8%. In July, group sales in Europe rose by 16%, a result clearly better than the performance of the market as a whole, which in the same month recorded an increase in registrations of 9,5% to 1,18 million vehicles.
Meanwhile, Ferrari's commercial and marketing director, Enrico Galliera, said in the press conference to present the Frankfurt Motor Show that the brand has suffered a limited impact from the crisis in China, with stable sales in the area thanks to the improvement in Hong Kong and Taiwan.
“China is worth 6-7% of our volumes. It's important, but not that significant” and he added “for a China that is slowing down, there are other markets like Hong Kong and Taiwan that are doing very well”.
Among the other industrial stocks, Prysmian (+1,6%) and StM (+2,1%) stood out. Brembo +1,8%.
TELECOM ITALIA RECOVERS. IN VIEW OF THE BRAZIL MISSION
Telecom Italia (+3%) recovered from Monday's bad blow (-3%). The stock absorbed the effects of Nomura's downgrade to the sector's rating. Analysts are looking at the news coming from the South American front, pending the board of directors' trip overseas. We note in particular positive indications on the front of the Brazilian market.
Tim Brasil's CFO said the company is not aggressively pursuing a merger but believes it is well positioned to capitalize on an industry consolidation. As for the numbers, the Ebitda margin should remain stable in the coming quarters and improve next year.
LUXURY STARTS AGAIN AT THE PRADA TRAILER
All luxury stocks regained ground after the publication of Prada's results which showed a lower than expected drop in profits in the first half. Shares exploded this morning in Hong Kong, surging 8,74% to HK$33,60.
The luxury group reported first-half net profit of 188,6 million euros, down 23% from 244,8 million in the same period of 2014. Robust cost control offset the decline in sales in Asia . Revenues, the figure for which had already been announced, stood at 1,82 billion (+4,2%).
“We will continue, on an operational level, an articulated review of the processes to improve their efficiency”, observed the number one Patrizio Bertelli, who added: “The global scenario will remain marked by uncertainty”.
Ferragamo (+1,2%) and Moncler (+2,4%) are also gaining ground thanks to the better-than-expected results published in the afternoon by Prada.
