After the storm, the Stock Exchanges, at least initially, should experience a moment of calm. European stock markets, judging by the futures on the Eurostoxx, seem set to open higher. S&P 500 index futures also signal a rebound of around 1%. The tail end of the violent fall triggered by the decisions of the ECB and, even more, by the forthcoming hike in US interest rates, hit Asia this morning.
Tokyo loses 1,5% despite the weak yen. Hong Kong -0,9%. CSI 300 of the Shanghai and Shenzen price lists -1,8%. Kospi of Seoul -1%.
Bini Smaghi: "There is no conspiracy against Italy"
The worst is over? Absolutely not. The sharp increase in bond yields, over 4% for BTPs, signals that the season of cheap money, the "gasoline" of the Bull, is now behind us. Not only for Italy, points out Lorenzo Bini Smaghi, former member of the board of the ECB. “In the last three months – he says – rates have risen everywhere, in Germany by 120 basis points, in France by 140: BTPs have risen more, 200 points, because they are considered more risky. But if there was a conspiracy it would have to be against everyone. Including America, where rates have also risen”. On the other hand, the negative signals are multiplying.
Wall Street, the recovery will come at the end of summer
The S&P500 index fell 3,88% on Wall Street last night. From the all-time highs reached at the beginning of the year, the benchmark of the US Stock Exchange loses 23%, a movement which, according to market standards, is equivalent to entering a bearish phase, the one that occurs when an index loses more than 20% from the highs. A statistical signal that is very popular overseas, which is also confirmed by the sinking of the Nasdaq (-4,68%), which loses more than 30% from its maximum. Statistics teach us that, on average, it takes 52 sessions to get to the floor from which the rebound begins: therefore, about ten weeks. The rebound should come around the end of the summer, perhaps sooner or perhaps later, as each bear market, like the unhappy families in Tolstoy's Anna Karenina, bears differently.
Btp yields at the top since 2013. Giavazzi: gas cap needed
The collapse of the US lists overshadows the Caporetto of the European stock exchanges, starting from Piazza Affari, -2,79%, below 22 points, overwhelmed by the surge in the yield of the BTPs, to the highest since 2013 beyond the barrier by 4%, with the spread at 237 points. In both cases, the central bank's anti-inflation shift is at the origin of the collapse. But in Italy, as well as in the rest of more fragile Europe, the fall in government bonds is the consequence of the choices announced by Frankfurt last Thursday. As Francesco Giavazzi explained, a ceiling on the price of gas would be needed rather than resorting to rate increases. But this requires government intervention, which is met with strong opposition.
Thus the risk grows that the paw will probably be energetic enough to curb the recovery attempts of the European stock exchanges, starting from the blue chips. But a rebound, after the landslide that hit the banks, starting with Intesa Sanpaolo, is in the order of things.
The performance of Treasuries anticipates the recession
However, the trend of the money markets anticipates the recession in the USA. The 3,38-year Treasury Note went as high as 2007% yield, a level not seen since 3,16. The 3,34-year Treasury Note rose from 1,25% yesterday to 1,50%. The world is upside down: the differential between the two rates is negative by four basis points. When the yield curve is higher on the short-term side than on the long-term side, there is ample chance of an economic downturn. Against this backdrop, the Federal Reserve should raise rates by at least fifty basis points on Thursday, to 75-XNUMX%. But four major investment banks expect a hike of XNUMX basis points in July, plus two more by fifty points later this year.
Tech and Bitcoin, twin collapse
Only one blue chip closed with the plus sign: the old stainless Coca Cola. The landslide of technology continues, complicated by the increase in the value of the dollar and the consequent drop in foreign profits of multinationals, already in sharp decline: Microsoft -25% since January (like Apple), while Meta (formerly Facebook) falls by 50% and Amazon by 35%.
Things are certainly not better for cryptocurrencies: Bitcoin lost 19% yesterday, slipping below 24 points.
Tim, Stellantis and the rest. Titles to follow
However, there is no shortage of topics to follow in Piazza Affari. The operation of Tim network sales it will have very fast times, he writes this morning The Sun 24 hours: within a month a binding offer should arrive from the buyers, Open Fiber, Cdp and others.
Stellantis has announced its exit from the European car manufacturers' association Acea by the end of this year, as part of a broader approach to addressing the challenges of sustainable mobility, which also includes the transition from the traditional lobbying activity to a more direct interaction with the parties involved.
At Brunello Cucinelli, the president said that May and April were two positive months, especially in Europe and North America.
