The upward march continues. This morning, Asia recorded a new record in price lists, the highest for three months despite the caution of China, grappling with the strong yuan and the increase in raw materials which weighs on the profits of Beijing's formidable industrial machine. American stock exchanges are also struggling: on the one hand the recovery is picking up speed, on the other the fear of inflation is growing. And on the eve of highly anticipated labor market data due out on Friday, Fed hawk James Bullard says the jobs situation, despite a 8 million pre-pandemic job shortage, is better than first appears. In short, at this rate, the Fed's turnaround is closer. For now, Europe is not in this danger: low rates and new capital for investments are the medicine that favors the recovery of the Old Continent, starting with Italy. Of course, inflation is rising, back to 2%, the ECB's target. But the increase is only linked to the increase in energy: the rest still appears weak and in need of support. Spring must continue.
AUSTRALIA CANCEL THE EFFECTS OF THE PANDEMIC
Asian stock exchanges are in no particular order this morning: Tokyo's Nikkei rises (+0,5%) and both Hong Kong's Hang Seng (-0,5%) and Shanghai and Shenzen's CSI 300 (- 0,9%). On parity the Kospi of Seoul.
Australia has overcome the damage of the pandemic. The GDP (+1,8% in the first quarter) is today above the data of 2019, a result that has few comparisons: the USA is still 1% lower, the European Union is 5%.
Wall Street closed around parity after a buoyant start. Dow Jones +0,05%, S&P 500 -0,05%, Nasdaq -0,09.
The good data coming from the manufacturing industry were offset by the new increase in commodity prices: the Bloomberg Commodity index yesterday reached its highest level since the end of 2016, at 94, and this morning it is down slightly.
TBONDS RISE MORE THAN 1,6%, NEW SOS FROM Türkiye
The increase in commodities kick-started the sell-off on government bonds, with the 1,61-year Treasury Note yielding XNUMX%.
The euro-dollar moved little, at 1,222, on a day marked by the new fall of the Turkish lira, to its lowest level against the dollar: President Erdogan has once again asked for a drop in the cost of money.
Wall Street futures are little moved.
ROBINHOOD NOW FOCUS ON CINEMAS
The long Memorial Day weekend reinvigorated the small investors who animate the online discussion groups. The case of the day was AMC Entertainment Holding, the first cinema chain in the world, already on the brink of bankruptcy. Since the beginning of the year, the stock has multiplied its price by about sixteen times. And yesterday it closed up 22%, at 32,04 dollars, after the news of a placement of a capital increase of 230 million dollars.
Another security attack by Russian hackers should be reported. After the pipeline, JBS, the most important meat processing chain in the world, was targeted. Several plants in both America and Europe were put out of action by a software attack.
OPEC+ CELEBRATES: MAJORS AND SHALE IN TROUBLES
At the heart of the commodity rally is oil, at its peak for the period following the OPEC+ meeting. Brent is traded this morning at 707 dollars a barrel, Wti above 68 dollars. The cartel limited itself to confirming the increases already planned for next month: no precise indications on the second half of the year. The Saudi Arabian energy minister spoke only of the trend in demand – which, as already anticipated by the data on the movement of oil tankers, is clearly improving – but did not show his cards as regards supply. It is probable that OPEC+ is waiting to see what happens in the United States, where the approximately two million barrels a day supplied by shale producers prior to the pandemic have been missing for some months now.
Even the majors are in great difficulty to comply with the Paris agreements as requested by shareholders, funds included, and the judges in The Hague, who have forced Shell to accelerate its exit from hydrocarbons. Furthermore, yesterday, President Biden banned the extractions that threaten the Alaskan sea environment: "It is vital to respect the Paris agreements - notes Nick Slanbury, manager of the Legal & General pension fund which manages 1,43 billion dollars (and not 1.800 billion as erroneously published) – but only in the framework of a political agreement valid for all. Otherwise prices will fly and profits will disappear”.
MILAN AT HIGHEST SINCE 2008, ISTAT RAISES GDP
Mario Draghi plays the charge of made in Italy from Sassuolo, land of ceramics and good football. Piazza Affari responds, accelerating to 25,553 points, the highest level since October 2008, when the economy entered the darkest tunnel of the Italian crisis. In the afternoon, the rally partially subsided and the index gain (+0,6%) stopped at 25.321 points, but the feeling remains that, finally, the Bel Paese has turned the page.
Istat reversed the initial estimates which indicated a 0,4% drop in GDP in the first quarter, revising the figure upwards to +0,1% compared to the previous three months. The acquired change in Italian GDP for 2021, the one that would be obtained if zero growth was recorded in the quarters following the first, is +2,6%. May (+5,5%) was also the fourth positive month out of five in 2021 thanks to the indications from the quarterly results, the good performance of the vaccination plan and the approval by all EU member states of the Recovery Fund. The knot of employment remains, a shadow that requires the ECB to insist on an expansionary monetary policy.
FRANKFURT RECORD, PARIS RETURNS TO 2000
With the positive performance in May, the Italian market closed the gap compared to the other European markets. The increase since the beginning of the year extends to +15,50% (including already detached dividends).
Positive price lists also in the rest of Europe. Frankfurt updated its intraday record, to end up 0,94%. Paris has revised the highs reached in 2000; London advanced by 0,82%.
MARKIT: "AMAZING" THE ITALIAN RECOVERY
The data on the recovery of European manufacturing contributed to favoring the race: the PMI index rose in May to 63,1 points, above expectations, at a rate which, says IHS chief economist Chris Williamson, "is unprecedented in the almost 24-year history of the investigation”. Italy in particular is traveling at a record pace, a level that IHS Markit analysts define as "amazing": 62,3 points. Providing a strong boost, says Markit, is "the seasonally adjusted New Orders Index, which hit an all-time high and showed a rapid increase in overall new order volume."
Volkswagen runs (+3,06%): the group is planning various partnerships to reduce costs and is looking for investors to share expenses starting from the batteries. Porsche's listing is also under discussion.
Daimler is up 2,6% after settling the dispute with Nokia over the use of certain patents.
Arcelor Mittal is advancing in Paris (+2,4%), not even affected by the consequences of the sentences on Ilva.
The City was driven by the excellent performance of basic materials, the most lively buying: Anglo American, Bhp Billiton and Glencore recorded increases of more than 4%.
BTP: FALLING YIELD, SPREAD TO 101
The BTPs close the session in positive territory, maintaining a better trend than the rest of the European sector throughout the day and looking confident at the ECB meeting on 19 June.
The 10-year rate has been declining since mid-May and yesterday it went as low as 0,82%, a new low for about a month, from 0,87% at the previous close.
Similarly, the ten-year spread with the Bund went up to 101 basis points, the lowest since the end of April, from 105 on the previous day.
SAIPEM LEADS THE ENERGY RACE
The rise in oil prices made the sprint of oil stocks possible, starting with Saipem (+3,98%). Equita sim reaffirmed today the hold rating and the target price of 2 euros on the stock, after the company announced that from today Antonio Paccioretti will take on the role of chief financial officer. Mediobanca securities instead confirms the outperform rating and the target price of 2,8 euro. Tenaris (+2,7%) and Eni (+2,37%) also rose sharply.
TONIC BANKS, CATHOLIC ABOVE THE TENDER PRICE
Expectations for a robust economic recovery, combined with consolidation movements in the sector, favored banks instead. Tonica Popolare Sondrio: +2,4% after the increase to 9% of the stake controlled by UnipolSai (+1,8%).
The big names were positive: Unicredit and Intesa Sanpaolo rose by 1%, as did Banca Bpm, the real star of the season waiting for the risk.
Cattolica moved little after the race on the eve. However, the stock remains above the offer price of 6,75 euros announced yesterday by Generali (+0,7%). Institutional investors, including Berkshire Hathaway, are convinced they can pull off a price rally. In evidence Poste Italiane (+2,03%).
Retelit retraces (-1,3%), but remains above the takeover bid price, the 2,85 euro offered by shareholder Marbles to get to the delisting.
STELLANTIS: +49,5% ENROLLMENTS IN MAY
The automotive sector shines: Cnh Industrial +1,66%, Stellantis +0,54%. With the Stock Exchange closed, the data on May registrations came out. The Stellantis group registered 56.148 cars in Italy, 49,5% more than in the same month last year. In the first five months of the year, there were 294.623 registrations, 60,7% more than the same period in 2020.
BESTINVER PROMOTES ATLANTIA
Atlantia's rally continues: +0,96% after the green light for the sale of Aspi. Webuild (+4%) crosses the 2 euro threshold for the first time since 2019. Bestinver confirms the Buy with a target of 2,3 euro.
COUNTERCYCLIC STOCKS HOLDING DOWN: DIASORIN -1,8%
The anti-cyclical stocks were penalized by expectations of a recovery, among which healthcare companies stand out: Diasorin loses 1,8%, Amplifon 0,8%, while Recordati is at parity -0,09%.
Worth noting is Tesmec: +3,65% after signing a contract with Terna. About Aim, money on Portale Sardegna (+18,75%).
