On Independence Day, Nasaq decided to go nuts. Indeed, a number: 123,47. It is the price to which, mysteriously, many stocks have adjusted, causing sudden rises and falls: Apple, for example, found itself losing 14,3%, Amazon's capitalization fell by 398 billion. Microsoft, in turn, rose by 79,1%, Zynga by 3.200%. It happened after the closing of the official exchanges, yesterday evening, wreaking havoc around the price lists connected to the tech stock exchange: today's holiday arrives by the way.
XI'S WRATH, TRUMP PLACES THE GAS
Even dictator Kim continues to freak out. During the night, just to greet the G20, North Korea launched a new missile into the Sea of Japan. A sinister joke in a hot area of the planet. Who doesn't want to joke is the Chinese president Xi Jingping who, on the eve of his departure for Germany, made a fiery phone call to Donald Trump, after some initiatives by the US president including the sale of arms for 1,4 billion to Taiwan. All on the eve of the meeting between the Chinese president and Vladimir Putin. Meanwhile, Trump arrives in Warsaw with the stated aim of selling gas to Eastern countries, in competition with Moscow. In short, a turbulent week is looming, which however does not disturb the financial markets, which are in great shape.
A warm atmosphere also on the front of our banks. The decree to save Veneto banks is being discussed in Parliament, but the focus is on Brussels and Frankfurt: today the green light could come for the rescue of Monte Paschi.
ASIA RISES, THE DOLLAR BOUNCES
Stock markets up this morning on the heels of oil. Brilliant Sydney (+1,7%), the most sensitive to the trend of raw materials. But the liveliest sector is the financial sector (+2,4%), awaiting the decisions on rates by the central bank. Tokyo (+0,3%) and Hong Kong also rose thanks to the propellant in the energy sector (+1,3% and 2,7% respectively). Weak Shanghai and Shenzhen. Seoul is down (-0,6%) after the new missile arriving from the North.
The dollar rebounds to 1,1366 against the euro. On Wall Street there was a contrasting performance in a session conditioned by the semi-holiday climate: yesterday the US stock market closed at 19:00 (Italian time) in view of Independence Day, a national holiday. But this did not prevent the Dow Jones index (+0,61%) from updating its all-time high to 21.562,75 during the session. The S&P 500 also rose (+0,23%). New slowdown in the Nasdaq (-0,49%).
Very positive news from the macro front: the ISM manufacturing index jumped to 57,8 points in May, up from 54,9 the previous month and above the consensus of 55,2 points. In the wake of the news, yields on the bond market rose: the 2-year Treasury increased by 4 basis points to 1,42%, a level not seen since October 2008. The 2,35-year, at XNUMX%, did not move much .
OIL, EIGHT RISES IN A ROW. ORDERS PUSH SAIPEM
Oil up for the eighth session in a row. Both Brent ($49,36 a barrel) and WTI ($46,82) made gains of more than 1%: it's the longest positive streak in five years. There are signs of a slowdown in field exploration and development in North America. The Baker Hughes index on the number of active drillers last week recorded its first drop since the beginning of the year: active drillers fell to 756 from 758 the previous week.
On Wall Street, the Energy index closed at +2%, the increase in May last month: Exxon +1,4%, Chevron +1,9%. In Piazza Affari Eni rose by 1,2%. Saipem +3%. The company has announced that it has received orders worth half a billion dollars, the bulk of the assigned works are in Saudi Arabia. Tenaris +3%.
FLY THE TRANSPORT INDEX, CAR COLLECTION
The most robust signal of an increase concerns the record high of the Dow Transportation Average index (aircraft, railways and shipping companies) which has always been considered the most sensitive barometer of economic activity. The automotive sector is also on positive ground, thanks to less negative than expected sales figures: Ford +3,3%, General Motors +1,8%.
Tesla, on the other hand, slows down (-2,5%) despite the fact that on Sunday evening, surprisingly, the CEO Elon Musk announced that the new Model 3, the first mass-produced car of the house, has passed all the regulatory tests two weeks in advance . Tesla expects exponential growth in production which will rise from 100 cars expected in August to 20 by December. In the meantime, however, deliveries of the S models in June were lower than promised (22 units against 24).
FIAT CHRYSLER SUPERSTAR IN THE USA AND EUROPE. CNH ALSO SHINES
The protagonist of the day was Fiat Chrysler (+5,88%) promoted by the results of sales for June both on and on this side of the Atlantic. The day ended with the publication, with the Stock Exchange closed, of data on registrations in June in Italy: +12,6% against an increase of 12,9% in the market. The market share stood at 28,56%. All brands grew (Alfa Romeo +23,1%, Jeep +18,7%, Fiat +15,8%) with the sole exception of Lancia. There are eight FCA models in first place in as many segments.
Earlier, the results of the US market were announced, still showing a marked decline. Sales of the FCA group were down by 7%: better than forecasts (Edmunds.com gave a probable drop of 10%). But sales of the most profitable models, the Ram and Grand Cherokee, held up. In the morning positive notes had arrived on sales in France (+6,4% on equal working days) and in Spain +3,1%.
Cnh Industrial also made a big splash (+2,87%). Goldman Sachs analysts have raised the target price of the stock from 11,6 to 12,2 euros, confirming it in the Conviction List Buy. Experts believe that the group may improve its 2017 guidance when it releases its second quarter accounts, expected on July 26.
MILAN IN YELLOW JERSEY. BUT EMPLOYMENT SLOWS DOWN§
Turning point with a bang for the European stock exchanges, thanks to the boost of economic recovery and the rise in oil prices. Tensions on the interest rate front have given the banks. The good tone of the credit sector was felt above all in Milan, by far the best place: the Ftse Mib index rose by 2,08% to 21.013 points. The markets of Madrid (+1,53%) and Paris (+1,47%) were also effervescent. In Frankfurt, the Dax gained 1,22%. Positive, less euphoric London (+0,88%).
In Europe, financials stand out, Eurostoxx Banks up 3%, and insurance companies, up 2%. Stoxx energy also did well (+2%). On the macro front, the negative note comes from unemployment which rose to 11,3% in May (from 11,2%). “The increase in unemployment is not due to a decline in the inactive but to a 'genuine' decline in employed persons, the most marked since February last year”, observed Paolo Mameli, economist at Intesa Sanpaolo.
On the other hand, the indications from the manufacturing front are positive. The European PMI index stood at 57,4 points in June, a 74-month high. Italian industrial production, according to the Confindustria Study Center (Csc), will record a 0,4% increase in June compared to May, when a +0,4% growth was estimated over April. On an annual basis, the CSC estimates an increase of 3,2% for June after the +2,4% in May.
TOO MUCH EUPHORIA ON THE EURO AND RATES: THE ECB HOLDS DOWN
The market's reaction to last week's optimistic message from Mario Draghi is convincing the ECB that it is better to avoid signals in the next meeting in July that might suggest a change of course in monetary policy. This is what Reuters claims after "a conversation with six central bank officials in the euro area". Frankfurt, in particular, did not like the rise in the euro and in government interest rates after the president's words. Therefore, the reference to "strengthening or prolonging Qe if necessary" could be maintained (and not eliminated as assumed): the deletion of this sentence would be interpreted by the markets as a signal of the start of the gradual reduction of the purchases of securities, considered premature by Draghi's collaborators.
Meanwhile, the good tone of the market has also infected the government, starting from the periphery of the euro area. The yield differential between BTPs and Bunds on the 10-year segment stood at 166 basis points (against 168). The 2,14-year rate fell to 2,15% from XNUMX% at the last closing. The German paper followed the trend of US bonds which, after the better-than-expected data from the ISM, saw a significant rise in yields across the curve. Very sustained interest on the part of specialists in the reopening of BTP auctions in which the Treasury assigned almost all of the eight billion offered last week.
BANKS RUN: BPER, UBI AND UNICREDIT ON THE SCUDI. SALTS ALSO CARIGE
The banks are accelerating: the Stoxx sector index rose by 3,27%. At the head of the Banca Bper ranking (+6%), best banking stock today. The group acquired 100% of the capital of Nuova Carife from the National Resolution Fund. The conclusion of the transaction, reads a note from the institute, was carried out after the National Resolution Fund completed the capital increase of Nuova Carife for a total of 290 million euros, to achieve a target capital pro - form equal to 153 million. Nuova Carife sold the sale of a portfolio of non-performing loans with the Atlante Fund and with Credito Fondiario for a gross amount of 340 million.
UniCredit +3,9%. The bank concluded the sale of Pioneer to Amundi with a net capital gain of 2,1 billion and an increase in the fully loaded Cet1 of 84 basis points. Since the beginning of the year, the share has gained 24%, better than the +15% recorded by the Eurostoxx Banks. The same increase for Ubi Banca. Intesa Sanpaolo +2,7%, Banco Bpm +2,7%.
Banca Carige made a clear recovery (+3,89%) on the day of the Board of Directors which approved a maneuver of 700 million including a capital increase of up to 500 million and a sale of assets which aims to achieve at least 200 million.
MPS, WHITE SMOKE BETWEEN TODAY AND TOMORROW. UNIPOL IN THE RALLY
During the week, perhaps already today, the go-ahead from Brussels should arrive for the safety of Monte Paschi, the authorization which should pave the way for the intervention on the 8,3 billion euro capital. The return to Piazza Affari of the bank, initially indicated for the end of July, could be postponed to September.
Among the asset management companies, Azimut +2,3%, FinecoBank +3,2%. Unipol +5% thanks to the promotion of Kepler which raised the target on the stock to €4,35 from the previous €4,10 with a confirmed Buy rating. Generali rose by 1,2%, Unipol Sai by 1,7%.
A2A AND RECORDATI AMONG THE (FEW) CLOSURES IN RED
A2a, lost 0,41% to 1,45 euros. The multi-utility notified the government of Montenegro of the exercise of the put option envisaged by the shareholders' agreements signed in August 2016 and amended last March, for the management of Epcg.
Recordati is down by 1,9% to 34,85 euros, it is the worst blue chip in the Milanese list. The stock closed last week with a 5,5% loss, the largest in a year but up 30% since the start of the year. The company has finalized the agreement with AstraZeneca of the European rights of metoprolol.
Among the smaller stocks, Chl lost more than 10% after announcing last week that it will not repay the fourth installment of the convertible bond loan.
