EU GIVES GREECE TWO YEARS. BUT MUST DECIDE WHO PAYS. SAWIRIS WAKE UP TELECOM. BERNABE':” THEY HAVE TRUST IN ITALY”
(Almost) white smoke from the Eurogroup on Greece. Athens obtained the longed-for two-year postponement to achieve, in 2016, the goal of a deficit/GDP ratio of 2 percent. But the decision on who will have to foot the bill for further aid (according to calculations, 32,6 billion euros) will only be taken by the November 20 meeting. Furthermore, it is not clear whether and to what extent the IMF will participate in the additional effort.
The 'squaring of the circle' will have to take into account the 'triple A' countries which, like Austria, have already indicated that they do not want to finance Athens' new needs with taxpayers' money. And the vote, or rather the veto, of the German Parliament hangs over everything: before any decision at the level of the Eurogroup, warned the German finance minister Wolfgang Schaeuble, "the Bundestag must be consulted".
In short, the European Union has decided that Greece must not leave the euro area. But it is not yet known how the bill will be distributed. Already this morning there will be a direct confrontation between the German finance ministers, Wolfgang Schaeuble, and his French colleague Pierre Moscovici. The markets acknowledge that the Greek tragedy can still reserve twists. And they are being cautious.
This morning Tokyo -0,3% is starting to close lower for the fourth consecutive session. The drop in Hong Kong -0,7% is even more marked. Flat encephalogram on Wall Street: Dow Jones unchanged, S&P +0,01%, Nasdaq -0,02%. In Europe, only Frankfurt closes above parity, where the Dax index rises by 0,07%, the Cac 40 in Paris drops by 0,35%, the Ftse 100 in London drops by 0,04%. In Milan, Piazza Affari drops by 0,39%.
ASIA
The patrimonial also frightens the East. The Shanghai Stock Exchange fell by 1,5% lows two months this way. The reason does not lie in some unexpected development of the Party Congress which is approaching its conclusion without, for now, having reserved any surprises. But in the news given by the official Xinhua agency which anticipates the significant increase in the property tax. The government, writes the agency, is following "with great attention" the awakening of the volumes of real estate sales and is ready to intervene.
Since the beginning of the Congress, the Chinese stock market has fallen by 2,7%. Even more marked was the decline of the Taiwan Stock Exchange which in 2012 left around 25% of the capitalization on the ground.
AMERICA
Concerns about the so-called “fiscal cliff” also continue to weigh on the markets (fiscal cliff). But yesterday there was a clearing up: Glenn Hubbard, Mitt Romney's main adviser on tax matters, opened up the possibility of an increase in the average tax rate of the richest taxpayers.
In the meantime, M&A operations are taking hold: the investment house Jefferies Group rises by 14% after the announcement that Leucadia, the current largest shareholder, will launch an offer to increase its stake. Titanium Metals climbs as much as 43% after Precision Castparts offer. TripAdvisor gains 4% after Morgan Stanley promotion.
Apple Lossless Audio CODEC (ALAC), is down 0,8%% after announcing a 22-year licensing deal with HTC that ends one of the worst ownership rights deals for smartphones. Today CLSA analysts recommended buying the stock which has lost 19% since last September XNUMXth.
Scandal within a scandal at Lockheed. On November 9, before the announcement of the resignation of CCO Christopher Kubesik, guilty of adultery with his secretary, 57 contracts of short sale options on the shares of the defense giant changed hands against an average of 900. The Sec already in action, assures Bloomberg.
EUROPA
Unstable markets, on alert for the possible storm. Yesterday, pending the decisions of the Eurogroup, the sovereign debt market saw little movement. The euro it remained stable all day at 1,2718 against the dollar.
But there were symptoms of growing unease:
1) the yields on bonds up to 2 years of countries deemed "safe" have returned below "zero": Switzerland, Denmark, Germany, Finland and Austria.
2) the Euro/Swiss franc slipped to 1,2053, its lowest since mid-September. We recall that a move towards 1,20 would once again force the Swiss central bank to "print" francs to avoid excessive revaluation.
ITALY
On the government bond market, the yield on 10-year BTPs rose slightly, trading at 5,01%. Spread slightly up to 367 (+6 basis points).
The case of the day concerns Telecom Italy, which rose by 4,2% following the news, officially confirmed by Telecom itself, that the Egyptian entrepreneur Naguib Sawiris is willing to purchase a minority stake in Telecom Italia by investing 4-5 billion euros in newly issued shares. In 2011 Sawiris sold Wind to Vinpelcom (shares plus cash) for more than 7 billion.
Regarding the timing of the negotiation, we should note the declaration of Franco Bernabé, executive chairman of Telecom Italia: "there is the Board of Directors in December". Regarding the interest of foreign investors in Italy, Bernabe' commented: 'It means that they have faith in Italy'. Yesterday, on the occasion of a conference in Milan, Bernabe' had a brief conversation with Gabriele Galateri, director of Telecom and chairman of Generali, a shareholder of Telco, the holding company which owns 22,5% of the Tlc company.
As chance would have it, the ex-incumbent's exploit coincided with the judicial developments of the former number one of TI, i.e. Marco Tronchetti Provera. Telecom Italia will appear as a civil party in the trial which will take place on February 18 and which sees Marco Tronchetti Provera, former manager of the telecommunications company, accused of the crime of receiving stolen goods which is part of one of the strands of the investigation into the alleged illegal dossiers. The decision had already been taken by the company's Board meeting held last week.
Lastly, yesterday the Pirelli board of directors dedicated to the quarterly was held. The Bicocca company closes the nine months and the quarter with results in line with analysts' forecasts but revises its targets for 2012 downwards.
In the 9 months the group achieved EBIT of 592,8 million, up 31,4% on 2011, revenues of 4.574 million, up 7,2% and net debt of 1.869 million. Net profit of 308,3 million, up 22,7%. In the quarter revenues at 1.552 million from consensus at 1.557, Ebit at 192,1 million from 190,6.
The 2012 targets have been revised: revenues to 6,15 billion from approximately 6,45, net debt to 1,2 billion from "less than 1,1 billion", Ebit to approximately 800 million from at least 800 million. The thud of a defensive stock such as Campari, down by 5,8% after the results below expectations and which show a drop in revenues in Italy of 1,3%.
The banks fluctuated several times during the day, but overall, on the eve of the boards of directors of the two big credit companies, they remained negative. Unicredit closed down 0,3%, Understanding -1,3%. Also declining Banco Popular -1,6% MontePaschi it lost 3,2%.
Citigroup considers the Italian sector a "sell". Goldman Sachs cut its target from 0,4 eu to 0,38 euro Pop. Milan , which finished down 2,1%. Among the insurance companies, little move Generali -0,1%. It closed down FondiariaSai -2,5%, up this morning on the wave of the S&P promotion which raised the rating by two levels.
Another negative quarter for the editorial Rcs. At the end of September 2012, the net loss rose to 380,5 million, due to the effect of consolidated revenues which fell to 1.184 million (from 1.364 a year earlier). The deterioration is attributable “mainly to the decline in circulation revenues and advertising revenues”. The former fell to 601 million (from 672) due to the decrease in the Books, Italian newspapers and Spanish newspapers areas. The latter, in a collection market in which investments fell by an average of 10,5% in the first ten months of the year, stopped at 448 million, from 516 in the corresponding period of 2011.
Analysts' opinions are also decisive for: Finmeccanica down 4,1%, after Deutsche Bank confirmed its sell opinion, while raising the target price to 2,5 euros from 2,3 euros. Fiat – 3%: Bank of America cut its target price to 2,3 euros from 3,9 euros. Underweight judgment confirmed. Terna , on the other hand, closed up by 0,7%: Société Générale raised its target price to 3,1 euro from 3,0 euro. Buy judgment confirmed.
Among the rising stocks, the following cases stand out:
Atlantia +1,3%: in the first nine months of the year the net profit of the holding company that controls Autostrade per l'Italia fell by 11,2% to 680 million. Traffic on the motorway network under the concessions in Italy decreased by 7,5% in the period, while that of the foreign subsidiary concessionaires grew (+4,4%).
Brembo +2,7% after the confirmation of the 2012 guidance.
