The spread is making itself felt again. We almost forgot about it, thanks to Mario Draghi. But in the face of the acceleration of the Italian and international economic situation, tensions that seemed to belong to another era are revisiting. The Italian 2,284-year yield reached 2015%, the highest since the summer of 179. With Germany, the spread went up to 70 basis points. With Spain it reached 2012 basis points, a new high since the beginning of XNUMX. The surge in yields, on the eve of the Bot auction and that of medium-term bonds next Monday, signals the opposition of the markets to the hypothesis of early elections.
TRUMP RAISES THE TONE WITH MEXICO
But it also makes itself felt the pressing of Donald Trump on globalization. Carmignac writes: “Inflation is already picking up almost everywhere, to varying degrees. If liberalism, globalization and innovation have proven to be deflationary measures, it is likely that supporting old uncompetitive industrial sectors through tariff barriers will help boost inflation. And the bitter confrontation on the wall between Mexico and the United States risks being the first step in trade duels that can damage global economic activity and increase political risk premia in some regions. As David Ricardo said, world trade is not a zero-sum game.
CHINESE NEW YEAR KICKS OFF, TOKYO SALES (+0,4%)
The tensions on the markets have slowed down the bull's run after two roaring days. The Chinese New Year celebrations begin today. Reduced activity in Hong Kong. Shanghai +0,3% and Seoul +0,8% ahead of the long weekend. The rebound of the dollar favored the rise in Tokyo (+0,4%).
The Mexican peso loses ground (-0,6%) while the confrontation on the wall on the border with the United States escalates. President Enrique Lopez Pena canceled a trip to Washington scheduled for Tuesday. Trump threatens to impose a 20% tariff on imports from the southern neighbor.
RECORD ACCOUNTS FOR EBAY, BITTER FOR BARBIE
The US markets lose energy after two days of strong increases. The S&P 500 index (-0,07%) and the Nasdaq (-0,02%) remained almost unchanged. The Dow Jones (+0,16%) consolidates above 20, closing at 20,100,91. The positive indications of the quarterly reports continue: 69,2% of the 146 companies that have already released the data have beaten the estimates.
Intel (+1%) and Microsoft (+1,9%) performed well after the Stock Exchange. Weak instead after the Alphabet accounts (-2,08%). Ebay closed up 5%. The company yesterday released forecasts for 2017 far above forecasts.
Ford -3,3% on the day of the presentation of the data for the quarter. Revenues of $36 billion and earnings per share of 30 cents. In the press release, the manufacturer points out that during the year, also as a result of investments, there could be some setback.
Also noteworthy is the leap forward of Royal Caribbean (+9,1%) in light of the positive forecasts for the cruise sector. Whirlpool, on the other hand, did badly (-8,5%) after lower-than-expected profits. Mattel, the American toy giant, has taken a nosedive: Barbie sales drop and the stock loses 12%.
Oil stable this morning after the leap forward on yesterday's price lists; Brent trades at 56,24 dollars (+2,1%), Wti at 53,78 dollars (+2%).
THE MEDIUM-LONG MONDAY AUCTION WEIGHTS IN MILAN
European markets sat down yesterday. The sales on fixed income triggered by the prospect of early elections weighed on Milan in particular. The forthcoming auctions will complicate the situation. Today it's the turn of the 6-month Treasuries, but attention is focused on the offer, considered very demanding, of the medium-long term bonds scheduled for Monday.
Milan, after reaching a maximum of 19.875 points, retraced to close down 0,73% at 19.440 points. Minus signs also for Paris (-0,22%), London (-0,04%) and Madrid (-0,48%), while Frankfurt held up to sales (+0,36%).
In addition to the tensions over the Italian debt, there are again problems with Greece: yesterday's meeting with creditors did not go well. Germany's finance minister, Wolfgang Schauble, told reporters that time was running out for Athens, which was too slow to implement the reforms it has committed to. The new aid could be frozen.
The Treasury announced that on the occasion of the placement on Monday 30 January it will make available to investors between 7,5 and 9 billion euros in 5- and 10-year BTPs and Ccteu.
Rates are also on the rise for other peripheral countries, in particular Portugal, with the 4,195-year bond yielding 3,998% from XNUMX% at yesterday's close.
MESSINA (INTESA) CONFIRMS THEIR INTEREST IN THE LION
In braking, after the strong swings of the previous days, the stocks involved in the great banking-insurance risk. Both Mediobanca (-2,7%) and Intesa (-2,6%) slowed down. Unicredit also slows down (-1%) after the leap on the eve (+8,9%). Only Generali rises slightly (+0,3%).
The lunge of Intesa's CEO Carlo Messina should be noted, yesterday in Turin for the celebration of the tenth anniversary of the union with San Paolo: "The leak of news on the strategic analyzes that the administrator is carrying out with various possible alternatives - he said – he suggested that we be explicit” towards the market, “noting that the bank is analyzing various alternatives and will evaluate within the necessary time frame. We are a bank that fears no one – he added – a group capable of generating a sense of belonging even outside Italy. But when we talk about our country we always do it in Italian and not in French. Those who defend Italianness in French make me laugh”. The reference is to the CEO of Unicredit, Jean-Pierre Mustier, and that of Generali, Philippe Donnet.
Meanwhile, the Democratic Party has presented a question signed by over 100 deputies from various political forces on how the government intends to protect the Italian character of Generali and avoid its stew. Economy Minister Pier Carlo Padoan stressed that it is a market operation between companies not owned by the state. Meanwhile, the chairman of Generali, Gabriele Galateri, has been heard by Consob. Today's Board of Intesa, Messina anticipated, will not deal with the matter.
Other stocks in the financial sector were down, starting with Banco Bpm which dropped 4%. Pop Bank. Emilia loses 1,7%, Ubi -1%, Unipol Sai -2%.
FIREWORKS ON STM
Positive indications coming from the quarterly reports, starting from the fireworks of StM (+8%): the first European company for the production of chips has announced the results of the fourth quarter 2016, closed with net revenues up by 3,5 % on the previous quarter and up 11,5% on the same period of 2015. The gross margin stood at 37,5%, higher than management forecasts.
FCA PROMISES AN AMBITIOUS 2017: THE DEBT WILL BE HALVED
The market rewarded Fiat Chrysler's quarterly report, albeit in a much more contained way (+1,2%) which shows ambitious targets for 2017, starting with the objective of a net industrial debt of less than 2,5 billion euros . This year the group sees net revenues of between 115 and 120 billion and an adjusted EBIT of over 7 billion euros.
“The results are good but the conversion in terms of cash is surprisingly positive”, commented Gabriele Gambarova of Banca Akros. Sergio Marchionne responded to an analyst saying he had not spoken to President Trump about a merger with GM, but he reiterated that such a deal would create the largest automaker in the world, which would be based in the US. “The inevitable things happen in the end”, concluded the CEO.
Exor also rose (+1,83%). Ferrari -0,34%: Mediobanca Securities raised the target price on the stock from 58 to 65 euros, confirming the outperform recommendation.
YOOX STILL IN DECLINE, LVMH IN MANEUVERS WITH MARCOLIN
In luxury, Yoox's landslide continues (-2%). Safilo down (-1,1%): Banca Imi raised the recommendation to add from hold with the target price set at 7,8 euro. LVMH chairman Bernard Arnault did not want to comment on the rumors of a possible acquisition of 10% of Marcolin. De' Longhi is up (+1,95%) after the publication of the preliminary 2016 revenues which arrived yesterday after the markets were closed.
