Business Square closes the last session of the week in parity, despite the sell-off on banks and the surge in fixed income. The spread between the benchmark 10-year Btp and its German counterpart jumped by 7,83%, to 123 basis points; the Bund rate rises to -0,1%, but that of the BTP is much worse and grows to +1,13%. What causes fear and triggers this flight from government bonds is inflation and investors remain convinced that central banks will not be able to continue and reduce the phenomenon.
In a context of weak tech, but brilliant stocks following the accounts, the other European markets are also little moved: Frankfurt -0,05%; Amsterdam -0,16%; Paris +0,38%; Madrid +0,37%; London -0,12%.
What brought some optimism back in the last half hour of trading was the improvement of Wall Street which, after a negative start, now sees the Dow Jones in progress thanks to some quarterly reports such as those of Chevron and Exxon Mobil, while, following the disappointing results presented yesterday, Apple and Amazon retreat.
The day was also full of macroeconomic data: in Europe the GDP of the euro zone in July, August and September confirmed an acceleration (+2,2%; +3,7% per annum). In particular, in Italy it rose by 2,6%, with an acquired growth of 6,1% over the whole of 2021.
However, what is worrying is a new surge in inflation which in October leapt by 4,1% per year (+0,8% per month), from 3,4% in September. This was the day after the ECB meeting which mainly debated “inflation, inflation, inflation” while postponing any updates in forecasts and monetary policy until December.
It is in this context that euro area yields have started to grow again, while theeuro he weakened. The index of the single currency dropped by around 0,6% against a panel of currencies (in the session the euro fell to its lowest level for about a year against the Swiss franc) and retreated by 0,9% against the dollar, with the change that moves in area 1,157.
According to Reuters Money markets are almost fully pricing in a 10 basis point rate hike by the ECB by July 2022 and nearly two hikes by October next year. A week ago they just priced a hike by October 2022 and saw less than 50% chance of a hike by July. According to Bloomberg's calculations, today operators' bet for a rate hike has approached from December to October 2022.
The tension on prices also remains high in the USA, where the measure preferred by the Federal Reserve for calculating inflation, the PCE (personal consumption expenditures price index) data, rose in October by 0,3% compared to the previous month, as expected. and compared to a year before by 4,4%, the maximum for 30 years, after the +4,2% of the previous two months.
The picture does not favor gold, which is trading sharply lower today: “On the one hand, gold should profit from high inflation expectations, but is being kept in check by the prospect of interest rate hikes both in the next, both in the more distant future,” says Commerzbank analyst Daniel Briesemann. It is recalled that the Fed may announce when the tapering will begin at its November 2-3 meeting.
Instead, it dates back to Petroleum and after the morning sells it moves to parity. Brent trades at around $84,34 a barrel.
The performance of black gold, after the long race, does not penalize energy stocks in today's session, which are among the best on Wall Street and also in Europe.
In Piazza Affari Eni shines, +1,97%, which today published the accounts highlighting an adjusted profit of 1,43 billion in the third quarter. It's mildly positive Tenaris +0,04%, while aggravating yesterday's losses Saipem, which yields a further 2,32%.
The numbers presented yesterday reward Recordati, which is today the best blue chip with an increase of 2,38%.
Bene Atlantia +1,77% and Moncler +1,47%, which increased revenues by 55% in the third quarter (+33% on 2019).
It is confirmed on the shields Exor, +1,22%, which yesterday signed a memorandum of understanding with Covea for the sale of PartnerRe to the French group for 9 billion dollars.
Among the big banks, Intesa goes against the trend, +0,8%, while they are sinking Bpm bank -7,28% and Bper-6,44%. According to analysts, with the lowering of the incentives for bank mergers introduced with the 2022 budget law presented by the government, M&A operations are losing appeal and this penalizes the groups that could have been protagonists.
Banca Carige, on the other hand, is not affected by the law (+0,91%).
Letter still up Telecom, -2,96%, after yesterday's knockout following the disappointing numbers in the quarter and the extraordinary board of directors of shareholder Vivendi, pressing for a new recovery plan for the company.
Stm drops by 1,05%, in line with the European tech sector, alarmed by Apple's disappointing results.
Outside the main basket Cattolica loses 2,66% (6,58 euro) below the price of the Generali tender offer (+0,05%) at 6,75 euro on the last day to adhere to the offer and after yesterday the minimum target of 50% plus one share of capital has been exceeded.
