Western markets will try today to react to the great fear, waiting for the closure of France and Germany to stop, or at least limit, the impact of the epidemic. The East, on the contrary, is mostly concerned that the wave of Covid-19 will not slow down the recovery of the Asian economies, which are coming out of the pandemic much better and much earlier. Yesterday the year-to-date performance of the MCI Emerging Markets index surpassed that of developed countries thanks to the rally in China (+15% since January).
BEIJING PRESENTS THE FIVE-YEAR GREEN PLAN
China's stock exchanges are positive again this morning, waiting for the press agencies to start spreading the first advances on the new five-year plan being drafted in Beijing. During the day, a thousand companies listed on the Shanghai and Shenzen stock exchanges will publish the data for the quarter. Among these, Sinopec, the country's number one in oil refining, presented a radical reconversion program of its activities: within a few years it intends to become one of the world's reference operators in the production of hydrogen.
The other markets were more contrasted: Tokyo's Nikkei lost 0,3%, Seoul's Kospi 1%, Sydney's S&P ASX200 1,1%. Mumbai's BSE Sensex opened down 0,5%.
However, the climate remains positive: Taiwan's exports to China grew by 22%, that of Japan by 14% also thanks to the boom in auto components, underlined by the Bank of Japan bulletin. South Korea's exports jumped 15,6%, a record since 1986.
S&P FUTURES RECOVER. APPLE LOSES 4,6%
After the freeze, the US markets are trying to react. S&P index futures gain one point after yesterday's heavy losses (-3,53%); The Dow lost 3,4%, the Nasdaq 3,73%.
The tech giants are down heavily, and will publish their accounts at the end of the session. Apple loses 4,6%, in line with Alphabet.
TWITTER (+6%) LITTLE WITH THE REPUBLICANS
Stormy session yesterday in the Senate on the occasion of the hearing, requested by the Republicans, of the big names in social networks, accused of censoring Trump. One Senator yelled at Twitter's Jack Dorsey: "Who c…gave you the right to decide for us?"
Pinterest's amazing quarterly (revenues +58% and monthly active users +37%) has however helped the whole social economy a bit: Twitter +6%, Facebook +3%.
Timid reaction of oil (+0,2% Brente, to 39,20 dollars) after yesterday's sharp fall (-5%).
EUROPE DROWNS IN THE SECOND WAVE. TODAY THE ECB SUMMIT
Euro dollar at 1,175, little moved after three days of decline. The return of the pandemic, with the lockouts it entails, could cancel the 2021 GDP growth of the euro area, envisaged as a base case by the ECB at 5%. For this reason, today at 14.30 Christine Lagarde could provide more precise and detailed information on the strengthening of the emergency purchase program (PEEP).
The surge in infections hit the European stock exchanges yesterday, which experienced the worst session since 21 September, returning to the levels of the end of May. The Covid-19 effect, which has spared no price list, exposes the fragility of the ECB's position, which will hardly anticipate the easing of monetary policy, already scheduled for the December meeting. Consob and the other market authorities of the Old Continent do not seem willing to move for now, re-proposing the ban on short selling: the landslide is not, after all, linked to market anomalies, but rather to a situation that got out of hand all, including France and Germany.
FROM THE BEGINNING OF 2020 MADRID -32,6%, MILAN -23,8%
Since the beginning of the year, the ranking of the worst markets has been all European. In first place is the Ibex 35 of Madrid, which lost 32,65%, followed by the FTSE 100 of London, which fell by 26,42%. The bottom step of the podium is occupied by Milan, where the Ftse Mib has lost 23,86% since the beginning of the year.
MERKEL PUT GERMANY UNLOCKED: FRANKFURT -4,2%
Yesterday Piazza Affari dropped 4,06%, slipping below 18 (17 points).
Frankfurt was the worst place (-4,2%). Angela Merkel has submitted a soft clause to the governors of the Land (but not too much). From 2 November, bars, restaurants, sports centres, theaters and cinemas will be closed and gatherings of people and public events will be prohibited. Schools and kindergartens will remain open.
Deutsche Bank, surprisingly, returned to profit in the quarter, but closed at -2,2%.
MACRON CLOSES FRANCE: "WORSE THAN IN SPRING"
Paris -3,4%. President Emmanuel Macron addressed the nation with a televised speech in which he announced a national lockdown starting at midnight, slightly more flexible than the two-month total lockdown adopted in March. “The second wave – he warned – risks being more deadly than the first”.
BUT CARREFOUR DOES GOLDEN BUSINESS
In the emergency, the results of Carrefour stand out. The French retail giant posted the best quarterly sales growth in at least two decades. However, the stock yields about 1%.
Things are no better in Madrid (-2,61%) and London (-2,51%). The British government, according to lo Spectator, is preparing for the worst-case scenario: 85 deaths, 356 hospital admissions.
BTP AT AUCTION TODAY, THE SPREAD RISES TO 140
Even the European bond market has come under fire: the issues of less secure countries are under fire. Even the BTP with 5- and 10-year maturities loses a few shots in the finale, under pressure in view of today's medium-long term auction. The six-month Bot at auction was placed at -0,478%, its lowest ever.
The increase in the spread to 140 basis points (from 132) was significant. The ten-year rate stands at 0,77% (against 0,71%). Today the Treasury offers between 5,25 and 6,5 billion euros in the 5- and 10-year BTPs and in the December 2023 CTZ.
GERMANY PROMISES MORE DEBT
German Finance Minister Olaf Scholz believes the country will take on much more debt than expected next year to finance the new coronavirus relief package. The sum initially allocated for 2021 of 96 billion euros of debt "is not enough to help companies survive the second wave of the pandemic".
MEDIOBANCA -5,7%: DEL VECCHIO DOES NOT GIVE VOTE TO NAGEL
Difficult to identify some positive signs in Piazza Affari in the midst of the general disaster. Even the quarterly accounts of the blue chips drown in anonymity.
The banks are suffering, starting with Mediobanca (-5,7%). The assembly voted the list presented by the Board, but the number one shareholder, Leonardo Del Vecchio, chose to vote on Assogestioni's proposal. The other Bigs are down sharply: Intesa, Unicredit and Banco Bpm suffer losses between 4 and 4,6%. Things are worse for the little ones: Creval -8,5% and Pop. Sondrio -8%.
FCA (-3,9%) SAVED BY THE USA, PEUGEOT ACCOUNTS OK
Fiat Chrysler (-3,87%) also suffers, notwithstanding accounts better than expected and the positive performance of PSA. The Lingotto, on the eve of the wedding with Peugeot, in the third quarter recorded a net profit of 1,2 billion and adjusted net profit of 1,5 billion. Adjusted EBIT stood at 2,3 billion, with record results in North America. Cnh -3,72%, Ferrari -3,25%.
PIRELLI PUNISHED BY THE EU. ENI: RED BY 808 MILLION IN 2020
Heavy losses also for other industrialists. Worst of all is Pirelli (-7,09%). The EU Court of Justice upheld the sentence as part of the investigation into the cartel in the electric cable market. Deep red for Buzzi (-6,42%). Stm (-4,63%) and Leonardo (-4%) are also bad.
Holds Saipem (-0,3%), which also had a worse than tormented start. But the purchases returned after CEO Stefano Cao estimated investments under 2021 million for 400. Eni -3% after i third quarter accounts closed with an adjusted net loss of €153 million. Since January, the six-legged dog has lost 808 million euros.
ATLANTIA -4,6%: "DEAR CDP, WE ARE NOT THERE YET"
Atlantia fell sharply (-4,62%). The board of directors of the company, "although appreciating some improvements resulting from the new elaboration of the offer, has assessed the related economic terms and conditions that are still not compliant". This is what we read in the note released at the end of the board meeting in response to the new offer from CDP with Blackstone and Macquarie. Thus the ping-pong on the fate of Aspi continues.
The bear has not spared the mid-caps: Danieli sinks (-10,07%), followed by Ovs (-7,93%) and Piaggio (-7,14%).
DIASORIN AND ACEA AVOID SHIPWRECK
Among the few stocks that survived, Diasorin (+0,3%) and Acea (+0,52%) stand out, in the wake of the positive assessments of analysts after the presentation of the 2024 industrial plan.
