Tariffs, infections, worsening economic forecasts from the Monetary Fund, even the New York marathon raises the white flag: there is more than one reason today to go to the stock market and continue to focus on safe-haven assets such as the gold. The closing of the session is in fact in deep red for the European stock markets, which accelerated downwards in the afternoon due to the strongly negative performance of Wall Street.
The week therefore continues in swing with Business Square which, after yesterday's progress, in today's session loses 3,42% and falls to 19.162 points, in line with Frankfurt -3,16% Paris -2,73% Madrid -2,86%, London -3,12%. Risk aversion hits oil, which suffers from the higher than expected rise in the data on US weekly stocks: Brent futures drop 6% and trade on the razor's edge of 40 dollars a barrel; American crude marks -6,5%, 37,74 dollars a barrel
The pole star, in such an uncertain phase, remains thegold: the August 2020 future trades around 1777 dollars an ounce. The dollar also recovered and the euro saw the exchange rate slip to 1,126.
More than one element has triggered this wave of pessimism. At first it was the press rumors about possible new US tariffs on 3,1 billion dollars of exports from France, Germany, Spain and the United Kingdom. Then the never extinguished outbreaks in the US and the reinvigorated German ones, as well as the increasingly impressive numbers globally. Even the New York Marathon, the largest in the world, has been canceled due to the coronavirus. Then, to completely sink morale, came the updated estimates of the International Monetary Fund: world GDP 2020 -4,9%, against -3% estimated in April. A sharper recession, followed by a slower recovery and leading to catastrophic consequences on employment and poverty. The bill for this scourge, in dollars, is 12.500 billion.
Italy's GDP will contract by 12,8% this year, or 3,7 percentage points more than the -9,1% forecast in April. Things will get better in 2021: +6,3%, 1,5 percentage points more than estimated in April. As a result, debt will rise in relation to growth: from 134,8% in 2019 to 166,1% this year and 161,9% in 2021. The deficit will go to 12,7% of GDP this year (8,3% the April estimate) and to 7,0% in 2021 (3,5% the April forecast). Debt above 100% also for France (125,7% in 2020 and 123,8% in 2021) and Spain (123,8% and 124,1%).
A prospect that overshadowed the German Ifo index, which measures the climate of business confidence, which made a record leap in June: 86,2, from 79,7 in May (against expectations of around 85). Even if German companies see the light at the end of the tunnel, this tunnel still looks quite long and treacherous.
The session is also slightly unfavorable for Italian government bonds: lo spread rises to 173 basis points (+1,45%), the ten-year rate is little moved at 1,26%.
In Piazza Affari all the blue chips are down. The worst sectors are auto, banks, oil.
The list of losses is headed by Tenaris -6,19%. They follow Exor -6,17% and Cnh, -5,84%. The latter, according to a note from the unions, is reconsidering its industrial plan in Italy due to the deterioration in demand due to the pandemic.
Rain sales for Mediobanca -5,72%; Bpm bank -5,3%. So Pirelli 5,06%; Saipem -4,93%: Eni -4,77%; Azimuth -4,73%; Inwit -4,6%. He finally gives in too Atlantia, -2,63%. According to Reuters sources, the company and the government have made a new attempt to get out of the stalemate on the group's motorway concession, but a solution still seems far away.
