Inflation rises again and the markets accept it. According to conventional logic, the rise in the price index in the USA (+2,1% against a forecast of 1,9%) should have triggered a wave of selling in view of the rate hike. But the markets, as usual, do not follow conventional logic. Wall Street, after an initial lurch, has interpreted the increase, linked above all to the increases in clothing prices, as a collateral effect of the recovery, which, if anything, erases the anomalous and mysterious persistent stagnation of recent years.
And so, after a day characterized by strong fluctuations, the US markets closed sharply higher, driven by purchases on the big names in the digital economy, Amazon and Apple (both +1,8%) and Facebook (+3,7 %, ahead). Netflix (+3%) was also very evident, which snatched producer Ryan Murphy from Fox with a contract worthy of a football star.
Stellar performance for Fossil: the eyewear brand for the Millennials scores an increase of 87,4% after the accounts. Many twists and turns favored the flight of the Nasdaq (+1,86%). At the end of the day, the Dow Jones was up 1,03, the S&P 500 was up 1,34%. At the start, the index had fallen by 0,5%.
The rise in inflation brings the season of rate hikes closer (perhaps four, more than the three already foreseen). Yields on T-Bonds rose but this time, unlike what happened after the data on the increase in employment, the volatility index closed sharply down. The 2,9-year T Bond, traded yesterday at 2,909%, rose this morning in Asia to XNUMX%.
The dollar weakens, despite expectations for a rate hike. The prospect of a sharp increase in US Treasury debt due to the expenditure planned by the Trump administration weighs heavily.
The euro traded this morning at 1,2473, the yen at 106,420, the highest in 15 months.
The Wall Street wave, after reviving the European stock exchanges in the afternoon, continued its run in Asia this morning. Hong Kong bids farewell before the New Year holidays with a 2% increase before closing its doors as Chinese markets did yesterday. Despite the rise in the yen, both the Nikkei and the Topix rose in Tokyo with gains of more than 1%.
The drop in the dollar favored the rebound of Brent oil which jumped by 2,6% to 64,84 dollars a barrel. In the US, last week, reserves rose by 1,8 million barrels, less than the expected +3 million barrels. In Piazza Affari Eni +0,9%, Saipem +1,2% and Tenaris +1,3%.
MILAN IS RUNNING AGAIN, THE FUTURES FORECAST UPWARDS
Afternoon of great emotions for the European Stock Exchanges which, after an initial negative reaction to the data on US inflation, surprisingly took the upward path in harmony with Wall Street.
Futures anticipate a start up 0,8%, which could lengthen the progress achieved yesterday afternoon. In Piazza Affari, the Ftse Mib index closed the day rebounding by +1,81% to 22.433 points. Milan consolidates its position as the best stock exchange in Europe since the beginning of the year: +2,8%. The other markets are also tonic: Paris +1,3%, Frankfurt +1,6%. London +0,64%. Bringing up the rear yesterday was Madrid +0.37%.
ITALY, GDP +1,4%. THE BEST FIGURE FOR 7 YEARS
Positive macroeconomic data was announced in the morning. Both in the Eurozone and in the EU as a whole, GDP grew by 0,6% in the fourth quarter compared to the same period of 2016.
In Italy, in 2017, GDP adjusted for calendar effects increased by 1,4%, the best figure since 2010. The slight decrease compared to estimates (1,5%) is probably due to a drop in consumption. But the circumstance, for now, does not worry: "We expect the recovery of domestic demand to continue, in parallel with the support of an expanding global demand that it will continue to offer to exports", writes Loredana Federico, Unicredit economist in a note.
THE SPREAD NARROWS TO 130 POINTS
The Italian secondary takes advantage of the weakness of the Bund, more influenced by the movement of the US curve after the higher-than-expected inflation numbers, to recover ground on the German counterpart. The spread returned to 130,3 basis points, after a brief drop to 134 cents immediately after the publication of the January US data on the cost of living. Italian paper benefited from the relative return of risk appetite on the stock exchanges.
The interest of specialist operators on the occasion of the reopening of the placement of BTPs on the 3, 7 and 30-year segment was concentrated on the shorter maturity, completely ignoring the 30. A total of only 537 million out of a total of 1,275 billion was assigned.
BPER GUIDES THE REBOUND. CREVAL, NEW SHARES AT 10 CENTS
The rebound of the Italian stock market could not fail to start from the banks, especially those most targeted by recent sales. The best blue chip of the day was Bper Banca (+5,19%), awarded for the second time in a few days in the Kepler-Cheuvreux promotion; the broker strengthened the Buy by raising the target to 5,90 euros from 5,60 euros. At the beginning of February he had raised it to 5,60 euros from 5,40 euros. The Cassa di Risparmio di Modena Foundation brought its stake to 3,0%.
Mps recovers (+4,53%) while Banco Bpm (+3,90%) and Unicredit (+2,82%) lengthen the pace. Ubi gains 0,75%; Socgen reiterated the Buy recommendation but reduced the target price to 5,20 from 5,30 euros.
Going against the trend is Creval (-4,34%) awaiting the details on the capital increase approved yesterday by the board of directors. The operation envisages a unit price of 10 cents with a 16% discount on the Terp. The successful outcome of the hyperdilutive increase (7 billion new shares) is guaranteed by the consortium of 11 investment banks led by Mediobanca and which includes, among others, Banco de Santander, Barclays and Citigroup.
LESS PAYABLES FOR ENEL (+2,71%). STARACE: WE CONFIRM THE TARGETS
However, they contributed to setting the tone for the second part of the session Enel's preliminary results (+2,71%), which showed an improvement beyond expectations of the debt.
Among the relevant data, revenues grew to 74,7 billion euros (70,6 billion euros in 2016, +5,8%); Ordinary Ebitda at 15,6 billion euros (15,2 billion euros in 2016, +2,6%) following the higher margin recorded mainly in Italy and South America, which more than offset the negative effects of the deconsolidation of assets slovaks. Net financial debt fell to 37,4 billion euro (37,6 billion euro at the end of 2016, -0,5%).
“The solid results of the 2017 financial year allow us to confirm the plan targets for 2018, continuing to implement our strategy for the years 2018-2020.” explained the number one of the group Francesco Starace. The stock released the advance on the dividend of 22 cents per share (10,50% gross yield) on Monday 2 January.
TCI ENTERS ATLANTIA, THE REVOLVING LINE FOR LEONARDO
Recordati +4,90%, recently penalized by sales for 2018 guidance below expectations. Another stock sacrificed in recent sessions is Atlantia, up 3,79% yesterday on the news of the entry into the capital of the Tci fund with a potential stake of 5%.
Well bought Leonardo (+4,66%) after the news of the renegotiation of a revolving credit line. which will allow significant savings on financial charges.
Pirelli +2,62%: Morgan Stanley confirmed the overweight recommendation and the target price of 7,5 euros.
JUVE UNDER FIRE, AND THE TOWERS LOOK AT THE AUCTION ON PERSIDERA
A bitter day for Juventus on the Stock Exchange too: -8,58% after the home draw with Tottenham in the Champions League complicated qualification for the next round.
Interpump performed well (+1,17%) which in 2017 recorded a consolidated net profit up by 43,5% to 135,6 million euro, higher than expected.
Strong purchases on Ei Towers (+3,99%): the terms for the binding offers for Persidera, the subsidiary of Telecom Italia (yesterday +0,58%) which manages five digital terrestrial multiplexes, expired today.
