The highs of Wall Street are starting again, driven upwards by the excellent data on employment. The favorable wind from across the ocean should ensure a positive start to the financial week, the exact opposite of what happened twelve months ago, when the devaluation of the renminbi, combined with a new massive fall in the Shanghai stock exchange, made us lose sleep for weeks to managers and investors, worried that the end of the world (financial, of course) was approaching.
However, the more positive climate does not obscure the problems looming over Europe's horizon, grappling with the problems of growth which not only does not take off but which, thanks to Brexit, according to the markets, is getting further and further away. Suffice it to mention the conditions of the Vodafone issue on Friday, the first after the decisions of the Bank of England: the telecommunications giant filled up with a 40-year bond at a rate of 3,01%.
THUD OF IMPORTS INTO CHINA. IN 2016 MILAN DOWN BY 22,4%
The large growth in US employment favors a bullish departure for the stock exchanges.
– Asia is advancing: in Tokyo the Nikkei index is up 2,1%, Hong Kong +1,2%. Weak Shanghai -0,1%. In July, Chinese exports fell by 4,4%. But what is impressive is the unexpected collapse of imports: -12,5%.
– Oil prices rose this morning: Brenta 44,93 dollars, Wti 41,90.
– Opening expected to rise this morning also for the stock exchanges of the Old Continent. Last Friday's rally was not enough to bring the week's balance into positive. Thanks to the strong recovery of the banks, the FtseMib index rose last Friday by 2,4%, but the performance of the last five sessions is a drop of 1,4%. The loss since the beginning of the year is -22,4%. The overall index of the Stoxx600 European Stock Exchanges closed the week with a drop of 0,2% (-6,7% from the beginning of the year).
– Supporting the rise is Wall Street's exploits: on Friday the S&P 500 index +0,86% and the Nsdaq +1,06% set new records.
– At the origin of the boom in the stock market and the dollar (+ 0,8% to 1,108 against the euro) as well as the drop in gold (-1,7% from the maximum) was the surprising growth in US employment: 255 new jobs, against the 180 expected.
TRUMP BETS ON THE ECONOMY, ITALIAN GDP ON FRIDAY
The first meeting between Vladimir Putin and the Turkish president Recep Erdogan holds the ground in international current events. Furthermore:
– Tonight Donald Trump, in crisis of consensus in the Republican house, will illustrate his economic program at the Detroit Economic Club. Among the proposals are tax breaks for companies that repatriate production to the US and protective tariffs against China.
– In anticipation of the election, the possible rate increase, possible after the recovery underway, is holding the table. Wall Street, seeking confirmation on the improving economic situation, will focus on the quarterly accounts of the retail (Macy's), luxury (Michael Kors) and entertainment (Walt Disney) giants
– Close attention to the data on the trend in consumption, slowing from +0,6 to +0,4% due to the slowdown in car sales. The University of Michigan Consumer Confidence Index, due Friday, is expected to improve.
– However, it is unlikely that anything will move before the next Fed meeting (September 21). But, as usual, to understand the trends of central bankers, it will be important to follow the meeting in Jackson Hole, scheduled for the end of August.
– In Europe the spotlight is on industrial production. We start today with Germany, tomorrow it's the turn of the Great German, followed by France on Wednesday. Tuesday from that of Great Britain. Wednesday space for industrial production. French and Italian consumer prices and US weekly unemployment claims are released on Thursday. Data on European GDP, including Italy, and that of the Eurozone are expected on Friday.
– In Italy, the auction for 12-month Bots for 6 billion is holding the court. On the other hand, the offer of medium-long term securities is not envisaged.
ATLANTE 2, A 2,4 BILLION ASSET FOR THE MPS CHALLENGE
Labors of Atlas second act. With today's shareholders' meeting, the new Veneto Banca, 97% controlled by the Atlante fund, kicks off. In the meantime, the action to clean up the suffering of Popolare di Vicenza has begun, another great challenge entrusted to the structure headed by Alessandro Penati.
Now the most delicate challenge begins: support for Monte Paschi, -17% on the stock market in the last week, despite the ban on short selling remaining in force. In particular, Attante 2 will have to take on the repurchase of a part of the non-performing loans (27,2 billion) of Mps, a company to be carried out with the contribution of JP Morgan, also involved in the equity part of the operation. It won't be an easy task: the fund's capital raising is completed today. Atlante 2, a private vehicle (but fleshed out by the funds of Sga, the former bad bank of Banco Napoli and by the presence of the CDP) will be able to count on 2,4 billion, including 800 million inherited from Atlante 1. The figure is less than declared target of 5 billion, which could favor new waves of pessimism. But the "courageous operation" (according to Alberto Nagel's definition) can count on the support of a part of international finance, not just JP Morgan.
No less important, after a week on the roller coaster, are the tests for other leading institutes targeted in the last five sessions: Ubi -12,9% Banco Popolare -11,7% Unicredit -10,9% Pop.Milan -10%.
UNDER THE MEDIASET SPOTLIGHT (WITHOUT AC MILAN)
Will the sale of Milan to a Chinese consortium have consequences for Mediaste? Apparently not. But the sale undoubtedly strengthens the financial position of Fininvest engaged in the default arm with Vivendi. Meanwhile, the conflict between Vincent Bolloré, Mediobanca's second shareholder behind Unicredit, and the Berlusconi group (in turn a member of the Piazzetta Cuccia syndicate pact) has unleashed the speculation of the season on the balance of our finances. To the point of hypothesizing the advance of the Breton financier on Generali (to be married to Axa) following an alliance with Unicredit. But also the veto of Matteo Renzi, determined to avoid a new Italian coup by Bolloré, a partner in Telecom Italia controllers.
It is not known how well founded these "indiscretions" are which, in any case, help to keep the market's attention high.
ENI-EXXON, TODAY EXAMINATION IN THE STOCK EXCHANGE FOR THE MOZAMBIQUE AGREEMENT
Great attention deserves Eni which over the weekend concluded the lengthy negotiations with an agreement to sell to Exxon Mobil a stake worth several billion dollars in the project to develop a liquefied natural gas field in Mozambique.
