MARKET PLACE BETS ON THE PARIS-BERLIN AGREEMENT
SUPERSTAR BANKS AND A BET ON LOTTOMATICA
The European stock markets have been positive since this morning, encouraged by the rumors of the English newspaper The Guardian, according to which Germany and France have decided to increase the bailout fund (European Financial Stability Facility) up to 2 trillion euros from 440 billion euros . Not even the usual slowdown by German Finance Minister Wolfgang Schaueble (the leverage effect cannot exceed one thousand billion) has conditioned the march of the Bull. Even the subsequent denials of EU officials have not altered the positive trend.
The markets are betting on the new face-to-face between Angela Merkel and Nicolas Sarkozy, who has left for Berlin to unblock the negotiations. The recovery of construction activity in the USA is also fueling the euphoria. Piazza Affari, where the Ftse/Mib index reached 16.292, with an increase of 2,02%, leads the race of the Old Continent: Frankfurt advances by 0,61%, Paris +0,52%. The euro appreciates to 1,379 against the dollar, from 1,375 at yesterday evening's close. WTI oil jumped to $89,1 a barrel.
The banks are driving the race. The seizure of 5,2 million ordered by the Milan prosecutor Alfredo Robledo did no harm to Unicredit (+ 245%). Il Messaggero reports that the board of directors in Piazza Cordusio yesterday approved the go-ahead for a maxi securitization of 9 billion euro residential mortgages. Intesa flies +7,32%, Banco Popolare +2,1% Mediolanum also increases by 1,7%%. The insurance companies were positive: Generali +1,98%, Fondiaria-Sai +1,05%.
In Europe, the Stoxx index of the banking sector rose by 2,3%. Bnp Paribas gains 6,2%, Deutsche Bank rises by 4,8%. Strong earnings also for insurance companies (Stoxx +2,2%). Allianz and Axa rose by 4,6% and 4,3% respectively. The battle continues ahead of Saturday's shareholders' meeting of Bpm +0,34%. In the meantime, analysts are trying to understand the possible impact of the prosecutor's investigations on the convert. The extreme hypothesis could lead to the non-conversion expected for the end of the year of the loan for which a conversion price is envisaged, albeit reduced to 2,71 euros from 6 euros, much higher than market values. and early conversion to 2011. In this case the core tier1 ratio, from the expected 7% (threshold reached after the capital increase of 800 million euro, the conversion of the convertible and the repayment of 500 million euro of Tremonti bond), would be 6,3%, well below what is foreseen by the rules that are emerging within the Community.
However, the stars of the day remain Lottomatica +5,41% and Ansaldo Sts +3,1%, even if the push from Finmeccanica (-0,39) ended during the session. Lottomatica, in particular, benefits from the data released by the State Monopolies: in September, Lotto collected 635 million euros, +47% compared to the same period of the previous year. Scratch & Win also did well (829 million euros, +5% compared to September 2010), slot machines (2,3 billion euros, down 7,8% compared to September 2010) and video lotteries (1,1 billion euros, +6% compared to August 2011). Lottomatica is one of the best stocks on the Italian Stock Exchange: since the beginning of the year it has recorded a growth of 39%. Sale Saipem +0,37% included in Morgan Stanley's preferred list. Eni +2,85 is also profitable. Down Fiat -2,50% and Pirelli -3,17%.
USA, CONSTRUCTION OF NEW HOMES STARTS UP +15%.
PRUDENT WALL STREET, CELEBRATE MORGAN STANLEY
A cautious start for the US stock market, despite the good data on construction activity in September which greatly exceeded economists' forecasts. The Dow Jones index gains 0,2%, S&P500 +0,1%, the Nasdaq loses 0,7%. In September, 658 new housing construction sites were started in America, with a growth of 15% compared to the previous month of August. Economists had expected growth of 3,3% to 590 new construction sites. No surprises came from the annual inflation figure, which rose slightly in September to 3,9% from 3,8% the previous month. Compared to the previous month, consumer prices rose by 0,3%.
Morgan Stanley starts the session with a rise of 5,2%. The financial firm said it closed the third quarter of 2011 with earnings of $1,14 per share, well above the consensus expectation of 30 cents. However, the figure is conditioned (as in the case of Bank of America) by an important extraordinary item. Net of accounting benefits, equal to 3,4 billion dollars, earnings per share are reduced to 3 cents, but analysts estimated a loss between 9 and 23 cents per share. The extraordinary items derive from adjustments to the company's debt valuation (DVA). The positive change of an accounting nature is generated when the debt is repurchased at a lower price. The stock yesterday gained 9% reaching the levels of early September, even after the rebound of the last two weeks, the loss since the beginning of the year is equal to 38%.
Intel also up. the world's leading chipmaker gains 2,7%: management forecasts for the fourth quarter exceed analysts' expectations. On the contrary, Apple shares are down by 4,5%. The company released its quarterly figures on Thursday evening with lower-than-expected earnings.
