"I hope the Fed reads the Wall Street Journal editorial before making another mistake leaving the market less liquid than it already is." Donald Trump thus continued his crusade against the Fed rate hike. We will see tonight if the president's offensive has breached the Fed's wall. Meanwhile, the Democrats have rejected the hypothesis of a budget agreement that would have allowed the start of construction of the wall (cost 5 billion dollars) on the Mexican border.
Meanwhile, pending the decisions of the Fed, attempts to recover the markets are complicated by the acceleration of the drop in crude oil prices, strongly desired by the US president, which is putting a strain on the big oil companies as well as the finance most exposed in the financing, via junk bonds, of US shale oil.
The positive news, for once, comes from Italy. A Whatsapp message arriving from the staff of Minister Giovanni Tria anticipated yesterday evening that there is an agreement with Brussels which will allow Italy to escape the infringement procedure. Today, probably, the markets (and the Italians) will know more. Including Parliament.
ASIA WEAK, TOKYO'S EXPORTS HOLDING DOWN
Tokyo's Nikkei index lost 0,7% this morning. Softbank Corp is down 10% after the mobile operator's IPO, a $62,2 billion placement.
Tokyo's trade balance is slowing down. In November, Japan's exports stopped (-0,1%) after +8% in October. The yen strengthened against the dollar for the fourth consecutive day, to 112,3, the highest since October.
Contrast other Asian exchanges. The CSI 300 index of Shanghai and Shenzhen dropped 0,3%. Hong Kong rises (+0,1%). Sydney falls (-0,2%) under the weight of energy stocks (-0,2%).
President Xi Jingping has disappointed those who expected an opening on the tariff front. "Nobody should think he can tell China what it can do," he spelled out during his long-awaited speech on the occasion of the 40th anniversary of Deng Xiaoping's economic reforms.
T-BOND YIELD DOWN, BOEING SHINES
Wall Street little moved awaiting the decisions of the Fed. The S&P500 index closed at +0,01%, slightly up the Dow Jones (+0,32%). NASDAQ +0,45%.
Boeing stands out (+3,8%) which announced the increase in the dividend and raised the buyback from 18 to 20 billion. The big names in technology rebound after the prolonged decline. The same goes for Goldman Sachs: +2,1% from the lows reached after the indictment in Malaysia.
The yield on the 2,80-year Treasury Note fell to 2,64%, that of the XNUMX-year Treasury to XNUMX%, both at three-month lows.
THE BRENT AT 56,5 DOLLARS. BUT KEEPS SAIPEM. GOLD AT $1.250
Free-falling oil prices have caused the energy sector to drop on all price lists. Exxon closed at -2,74, Chevron -2,42%. In Europe, decreases of around 2,5% for Shell and Total.
Eni is doing better in Piazza Affari, down 1%. Going against the trend was Saipem (+0,2%) driven by the expectation of an agreement with Novatek to build offshore platforms for the Russian company's Arctic LNG 2 (liquefied natural gas) project, a deal estimated at 2,5 billion euros.
Brent lost another 5% tonight. North Sea crude is trading at $56,5 a barrel, up 0,4% this morning. The production of the big names in the sector, Russia, the United States and Saudi Arabia travels at the maximum. But the trend may be over. Riyadh presented the budget law in which an increase in revenues from the sale of oil is expected for 2019.
The dollar weakens against the euro (cross at 1,138), gold rises to 1.250 dollars an ounce, reaching its highest level since this summer.
MANEUVER, MARKETS AWAIT DETAILS
Spotlights turned on today on the Btp, awaiting the developments of the Italian maneuver after the news of the agreement arrived with closed markets. A message from a collaborator of Minister Giovanni Tria announced that an agreement had been reached with the EU Commission. For the characteristics of the agreement, the result of the latest exhausting negotiations to define the structural cuts of the agreement (agreed in Brussels but for now unknown to Parliament) it will be necessary to wait for the meeting of the EU college scheduled for this morning.
However, there is no longer an element of uncertainty for the bond markets even if Bruno Rovelli, country manager of BlackRock for Italy (neutral opinion) argues: "The real issue is not so much the 2019 budget law but that of 2020 and 2021. The The main problem in the long run – he explained – is weak growth, which can be explained by a very negative productivity differential compared to other countries. At the moment there are no signs that the maneuver addresses this problem”, he concluded when presenting the 'Global Investment Outlook' for 2019.
BUSINESS PLACE -0,26%. FROM JANUARY -14,5%.
Piazza Affari stemmed the losses by closing down by 0,26% at 18.644 points. The FtseMib index is heading towards Christmas with a loss of around -2018% since the beginning of 14,5, slightly worse than the average recorded by the Eurostoxx (-13%) but also slightly better than the performance recorded by the Frankfurt Dax (-16,7 .XNUMX% since the beginning of the year).
According to consensus estimates, the multiples of the blue chips listed on Piazza Affari have reached very attractive fundamental valuations in relative terms: the FtseMib records an average P/E of 10,4, against 11,8 times for the Dax, 14,5 times of the CAC and 17,7 times of the S&P500. The expected return in terms of dividends is also among the most attractive: FtseMib at 4,35% gross, against 3,4% for the Dax, 3,7% for the Cac40 and 2% for the S&P500.
Yesterday the German Stock Exchange lost 0,29%, Paris -0,95%, Madrid -1,27%; London -1,11%.
THE SPREAD STARTS AGAIN AT 270 POINTS
The institute Prometeia has cut its estimate of Italy's GDP for 2018-2019. Growth in 2019 is expected to be 0,5% (0,9% in October), while that of 2018 is expected to be 0,9% (1% the previous year). Globally, the institute sees a slowdown in growth from 4,1 to 2,9% for next year: trade tensions are weighing on them.
In swing yesterday the bond market which, after a phase in negative territory. it recovered in the final, with the Btp-Bund spread returning to yesterday's levels in the 270 basis point area.
The yield on the Italian 3-year bond remains below 2,942%, falling in the final to 2,955% from XNUMX% at Monday's closing.
CADE AZIMUTH (-6%) AFTER THE RESIGNATION OF THE CEO
The worst stock of the day was Azimut (-6%). The managing director Sergio Albarelli has resigned "by personal choice and in full agreement with the corporate bodies". The resignation will be effective from January 25th. Following his resignation, the Board of Directors co-opted Gabriele Blei, giving him the position of director.
Banca Generali also fell in the sector (-1,7%).
Among the banks, Unicredit (-0,2%) has reached a definitive and settlement agreement on the dispute relating to the 'cashes, with the Caius Capital fund, which should have paid 90 million euros to avoid further legal troubles.
Carige is sinking (-13%) after the announcement of the closing of the non-performing securitization transaction (Riviera Npl), an operation already discounted by the market.
MONCLER BOUNCES, NEW ORDER FOR PRYSMIAN
Moncler (+2,15%) recovers the latest reductions; HSBC reiterated its "buy" on the stock.
Prysmian gains around 1,7%, supported by the new contract won in the USA. Leonardo also stands out (+1,5%).
FINCANTIERI AND SALINI, THE BRIDGE COMPANIES DOWN
Telecom Italia loses ground (-1,7%).
Among the companies participating in the "Per Genova" consortium which will be entrusted with the construction of the new Morandi bridge Fincantieri closes at -0,4%, Salini Impregilo -1,6%.
