Wall Street drags the Asian markets in the aftermath of a positive session for the European stock exchanges. Tokyo +2,44% recovers after yesterday's drop due to Chinese GDP data in the wake of American results and thanks to the solid increase in exports which in September rose more than expected (+6,9% to 59,6 billion of dollars).
The opening of the European stock exchanges is conditioned by the high volatility of these days with the markets awaiting the results of the ECB stress tests expected for Sunday. On Monday, the ECB started buying covered bonds and yesterday, rumors from Reuters revealed that the Eurotower would be considering starting to buy corporate bonds, in addition to covered bonds starting from January 2015. The Eurotower spokesman said that " the Governing Council has not taken such a decision.”
VERSO DOUBLE VERDICT: STRESS TEST AND FINANCIAL
ITALY BTPs SLOW DOWN
The Btp-bund spread closed down at 165 basis points and all the European stock exchanges are in strong recovery. Milan gains 2,79%, London 1,68%, Frankfurt 1,94%, Madrid 2,35% and Paris 2,04% after overcoming the initial shock of the sudden disappearance of Christophe de Margerie, CEO of Total, in a plane crash over Moscow.
A sharp slowdown compared to previous editions of the Btp Italia which, one hour after the end of trading, raised 1 billion today and overall, counting yesterday, around 4 billion. The Btp Italia, which is built on inflation, collides with a context where the main fear is rather deflation. In Russia, the Ministry of Finance announced that it has canceled its government bond auction, scheduled for tomorrow, for the second week in a row, due to "unfavorable market conditions". Russia has had difficulty selling its ruble-denominated bonds in recent months due to geopolitical risks stemming from the crisis in Ukraine. Meanwhile, the situation is once again escalating with Russia, which has further raised the conditions for restoring gas supplies to Ukraine.
In Italy and in four other Eurozone countries, the verdict on the budget is also awaited by the European Union, which must establish whether the maneuvers developed by the individual countries comply with EU rules. The Italian forecast budget has foreseen a structural adjustment of the deficit of 0,1% of GDP while the EU rules indicate a reduction of at least 0,5%. If the promotion or rejection is expected for next Wednesday (two weeks after receiving the budget), the EU must already communicate the first doubts to the governments within a week. The discussion could thus move tomorrow to Brussels where the European Council is on the agenda.
EYES ON QUARTERS, US INFLATION
AND MINUTE OF THE BUOY
The market continues to watch the corporate earnings while on the macro front they await the minutes of the meeting of the Bank of England and inflation in the US. Wall Street closed up: Dow Jones +1,31%, S&P500 +1,96% and Nasdaq +2,4%. Apple's excellent quarterly performance helped push the increase: revenues over 42,1 billion dollars in the third quarter against a forecast of 40 billion. The accounts of Texas Instruments are also good, with immediate benefits for Stm (+1,9%): the next quarterly of the semiconductor group (29 October the announcement of the accounts) should record the benefits of the rise in the dollar. Further encouragement to the markets comes from macroeconomic data: sales of existing homes rose by 2,4% in September to 5,17 million above expectations.
LUXOTTICA, WAITING FOR THE NEW CEO
THE CHINESE AT 2% OF MEDIOBANCA
In Piazza Affari the appointment of the new co-CEO of Luxottica is expected today +0,79% after the unexpected departure of Cavatorta. Meanwhile, the People's Bank of China joined Mediobanca at 2% +4,33% adding Piazzetta The day was favorable for the rebound of all bank stocks: Bpm +5,48%, Bper +5,18%, Banco Popolare + 5,09%, Mps +5,03% which rises after the reassurances on the progress of the stress tests. "The capital deficit of between 500 and 1.700 million euros assumed by the press is not reflected in the preliminary documents received so far," the institute said in a statement. After the results of the stress tests, Intesa Sanpaolo said it was ready to become an aggregating pole especially in private banking.
In Piazza Affari the best stock is Mediaset (+8,33%) which rebounds after Sky has denied plans for a new package of free-to-air channels in Italy.
Banca Carige +1,62% pending the board of directors which in the evening gave the go-ahead for the sale of the insurance assets, Carige Assicurazioni and Carige Nuova Vita, to Apollo Management Holdings.
Generals +2,24%. The Greek CEO confirmed that from next year the Lion will increase the dividend: "we will make it similar to the market average". There are no minus signs on the Ftse Mib: the worst stocks simply close unchanged (Autogrill, Gtech, Pirelli).
