FED MINUTES GELANO WALL STREET AND ASIA
DIFFICULT START EXPECTED. GOLD IN FREE FALL
"Several participants in the FOMC meeting stressed that the Fed should stand ready to change market interventions in the event of a change in economic conditions." In this way, the Fed's minutes confirm that not everyone agrees with Ben Bernanke's policy, ie plans to purchase government bonds and mortgage-related bonds on the market for 85 billion a month. The opposition made itself heard at the meeting held on 30 January. The stimuli, say the protesters, must be decided month by month according to the evolution of the economy. The decision to tie purchases to a medium-term objective, ie the fall in unemployment, risks only fueling Wall Street's "moral hazard".
What will be the practical effect of the minutes? Bernanke is unlikely to change course. The president of the Fed also enjoys broad consensus on the board, including the wing of the doves which is calling for even more drastic interventions, as can be seen from the minutes. But the opposition front has achieved a result: to instill in the minds of the operators the doubt that the "quantitative easing" could end sooner than expected.
THE INDEXES
The reaction of the markets was not long in coming.
On Wall Street, the main indices closed lower: Dow Jones -0,77%, S&P - 1,24% and Nasdaq - 1,53%.
Asian Stock Exchanges also fell: Tokyo - 1,42%. The drop in Hong Kong -1,80% is even more marked. In addition to the publication of the Fed's minutes, the tightening of real estate credit in China weighs, according to what was anticipated by outgoing leader Wen Jiabao.
Gold and sterling fall. Yesterday the pound fell sharply to 0,8727 against the euro, the lowest since November 2011. Now the British currency is traded at 0,8733. The dollar recovers against the euro to 1,3250.
Gold plummets, finishing this morning in Asia at 1565 dollars an ounce, against yesterday's 1.580 dollars, the lowest since last July.
A sudden influx of sales in the last half hour of trading hit European stocks yesterday, which until then had been almost balanced.
Paris is back by 0,6%, Madrid -0,7%, Frankfurt -0,3%. Only London closed slightly higher (+0,2%).
Lafarge, the world's leading cement producer, ran in France, up 5,4% after announcing better-than-expected 2012 results.
In Milan, the FtseMib index fell by 0,8%.
On the government bond market, the 10-year BTP is traded at a yield of 4,41%, unchanged from this morning, with a spread at 276, unchanged.
S&P'S WARNING, BUT THE TREASURY IS NOT AFRAID OF THE VOTE EFFECT
Standard & Poor's interprets the fears of big finance for the Italian vote: “Currently economic growth, more than the performance of the public finances, is the main risk for Italy's creditworthiness. The agency writes this in a report dedicated to the euro area, underlining that 'there is a risk that after the February 25 elections there may be a loss of momentum on the structural reforms needed to improve growth prospects" which remain "limited" by the rigidities of the labor market, by a heavily protected service sector and by the high tax burden falling on labor and businesses'. S&P also underlines that 'Italy's history of weak and fragmented government coalitions helps explain its high public debt', equal to 127% of GDP at the end of 2012. S&P has a BBB+ rating on the country with a negative outlook.
New Parliament, new decennial. In all likelihood, the Italian Treasury will launch the new Italian ten-year benchmark expiring in 2023, the one on which the calculation of the spread with the Bund is based, on the morning of Wednesday 27 February, the day after the announcement of the results. The issue, between 4 and 5 billion, will be the most significant test of the end-of-the-month auctions (around 20 billion). Also on Wednesday, the 5-year BTP will be placed for an amount between 2 and 3 billion. The day before, with polls still hot, it will be the turn of the BoTs: the market expects an offer of semi-annual bonds for an amount that could reach 9 billion euros. Before that, on Monday 25th, the offer of Ctz and BTP indexed to euro area inflation is scheduled for an amount of 4 billion.
INSIDE BUSINESS PLACE
In Piazza Affari there was no shortage of clear increases and decreases. The descent of Telecom Italia contributed to slowing down the list, which lost 2,4% after the renunciation of placing the "hybrid" bond at 60 years.
On the contrary, Telecom Italia Media's race resumed (+6,1%).
Mediaset down (-3,8%) after Tuesday's rise.
Even the banks closed weakly: Unicredit dropped by 2,3% Banco Popolare -2%, Pop.Milano lost 3,6%.
Understanding -1,2%. The financial statements of Crédit Agricole show that the banque verte sold the residual stake (1,953%) in the bank led by Enrico Cucchiani in the autumn.
Among the insurance companies, Generali fell by 1%, Unipol -2,5%, Fondiaria-Sai -3%.
In the opposite sense, the best stocks on the list include A2A +3,8% and Parmalat +4,3%. Good increase also for Autogrill +2,5%.
Among the industrial stocks, Ansaldo StS rose by 2,9%, Finmeccanica -0,5% and StM -0,45% down.
Pirelli rose by 0,4%. Closure down for both Enel -1,4% and Eni -0,9%.
Seat Pagine Gialle soared (+11,7%), rebounding after the exit of the last shareholder fund, Owl Creek Asset Management.
