God save the pound, weak again this morning (1,2402 against the dollar) after the black week: in fact, in five days the pound lost 3,6% against the euro (-18% from the beginning of the year) and 4,2% against the US currency (-15% since the beginning of the year). Surveys among entrepreneurs and managers underline the growing concern Jamie Dimon , number one of JP Morgan, and James Gorman of Morgan Stanley voiced the market alarm over the weekend at the meeting of the International Institute of Finance in Washington: “My personal opinion – said Dimon – is that Brexit has reduced by at least five times the chances that the Eurozone will last at least another ten years”. Both bankers have said they will move their businesses to New York, not the eurozone, in the event of a probable move from London.
TRUMP: "IF I WIN, I'LL SEND CLINTON TO JAIL"
It is with this fear that the Bigs left the IMF meeting just in time to attend the second round of the no-holds-barred match between Hillary Clinton and Donald Trump, abandoned by relevant segments of the Republican party who are calling for his exit from the scene to the benefit of Mike Pence, the vice presidential candidate. The race has now taken on the features of the worst trashy cinema: Trump, who promised in case of victory to send Hillary to jail for deleting the e-mails sent and received when he was at the State Department, held a conference before the confrontation press with three women who were former targets of Bill Clinton's attentions. The confrontation resulted in a series of harsh accusations between the two candidates. Trump has always ostentatiously turned his back on his opponent during his responses.
Who won? The markets have no doubts: the Mexican peso gained 1,4%, on the wave of the forecast that sees Trump now in serious difficulty. The Canadian dollar also rose (+0,3%), another potential victim of the candidate's isolationist programs (but until when?) of the Republicans. But for the Financial Times Trump fared much better than in the first TV comparison.
With this spirit, the markets are preparing to face the second week of October, according to statistics the best month of the year for Piazza Affari. Soft start in Asia, due to the closure of Hong Kong and Tokyo for holidays. Chinese stock markets, reopened after the long Golden Week holiday, are in positive territory (+1,2% Shanghai, +1,6% Shenzhen) also due to the decline in the yuan, which fell below the 6,7 threshold against of the dollar. The Asia Paific index rises by 2%. The drop in the Thailand Stock Exchange is significant (-2,5%): the conditions of King Bhumibol Adulyadej, 88, have worsened.
Oil dropped slightly this morning: Bent at 51,33 dollars a barrel, wti below the 50 dollar barrier. In anticipation of the OPEC conference (November 30) the unknown concerns the choices of producers outside the cartel, starting with American shale oil.
US QUARTERLY REPORTS LAUNCH. YELLEN SPEAKS FRIDAY
The decisions of the central banks and the geopolitical news will leave room for the accounts of corporate America during the week. From Tuesday evening the parade of the quarterly begins. We begin, as always, with the results of the aluminum giant Alcoa and then continue with the big banks (JP Morgan and Citigroup) and Delta Airlines. Spotlight on Wells Fargo, fresh from the ghost accounts scandal. Analysts are convinced that quarterly earnings will record a decline, for the fifth consecutive time, in the order of 0,7%. The average p/e of the S&P P500 index is 17x.
As usual, the utterances of central bankers will also move the markets. Janet Yellen will speak Friday at the association of economists' annual conference which will also be attended by hawk Eric Rosengren, one of the three FOMC members who voted to hike rates. The minutes of the last meeting of the Fed will also be published on Friday. In the US, after the lower-than-expected figure for employment (152 new jobs, unemployment up to 5%), it is very difficult for the Fed to move as early as November.
Mario Draghi, on the other hand, has already spoken about Qe at the meeting of the Monetary Fund. "The purchase program will continue until March 2017 and beyond, if necessary", he said, adding however that "it is evident that QE cannot last forever", an obvious observation but which has raised some apprehension after much talk about tapering (the possible cut in purchases) last week.
Great expectations also for the exits of Marc Carney and five other members of the Bank of England: the sharp drop in the pound is complicating the monetary easing policy practiced by the Boe to reduce the impact of Brexit.
Also in the spotlight was the American trip of BoJ governor Haruhiko Kuroda, the main champion of the negative interest rate policy.
THREE NAMES FOR A NOBEL. TODAY THE EUROGROUP-ATHENS AGREEMENT
An indication of the prevailing trends in the world of economists, divided between supporters of monetary expansion and champions of a mini-tighten, could be the name of the Nobel Prize in Economics, which will be announced today in Stockholm. According to Thomson Reuters, the favorites are Olivier Blanchard, former chief economist of the Monetary Fund, Esward Pail Lazear, the inventor of the "personnel theory", and Marc Melitz, theoretician of the economics of commerce.
On the European corporate front, the week was perhaps decisive for Deutsche Bank: on Friday, the S& P agency confirmed its Bbb+/A-2 rating (stable outlook). But the most awaited indications come from Qatar, already a major shareholder of Volkswagen, which could participate in a capital increase. Perhaps together with some large German manufacturing companies.
Today the Eurogroup will release the new 2,8 billion euro tranche in favor of Greece, after Parliament's go-ahead for the privatization fund. But for Athens the situation remains dramatic: the International Monetary Fund, which supports the restructuring of liabilities, will exit the bailout plan. Germany will not make any new concessions ahead of the autumn 2017 elections.
BPM, SATURDAY THE DECISIVE ASSEMBLY FOR THE WEDDING WITH BANCO POPOLARE
Great appointments ahead also for Italian banks. The Ubi assembly will be held on Friday 14th, increasingly cold in the face of the prospect of entering the good banks saved on New Year's Eve.
The board of directors of Monte Paschi will also be held on Friday, the last appointment before the presentation of the business plan at another meeting scheduled for the 24th.
However, the key event will be the simultaneous meetings which on Saturday 15th will have to approve the merger between Banco Popolare and Banca Popolare di Milano. The green light from the Verona assembly is taken for granted. The outcome of the meeting of the popular Milanese is much more uncertain, given the opposition of the main pensioners' organizations to the birth of the third Italian bank.
According to union sources, more than 9.000 tickets were sold to participate in the meeting on Friday evening, a figure destined to rise given that there is time until October 12 inclusive to register. A two-thirds majority is required to approve the merger and the concomitant transformation into a joint stock company. In the event of a negative vote, the Bank would have to convene a meeting again for the joint stock company, a step required by law by the end of the year.
BTP, A NEW THREE YEAR IS COMING SOON. AZIMUTH TITLE TOP
The week in Piazza Affari closed with a very modest rise of 0,03%. The best stock was Azimut (+10,84%) followed by Bpm (+10,13) and Ubi (+7,61%). The black jersey went to Monte Paschi (-8,6%), followed by utilities, the first sector to pay a possible rate hike: Terna -7,63%, Snam -6,2%.
The bot auction starts on Wednesday. The Ministry of the Economy will make 6,25 billion euro of 12-month BOTs available to investors, against a maturing amount of 7,1 billion. Tonight, however, the Treasury will communicate the amount of the auction of medium-long bonds next Thursday. A new 3-year is also envisaged, while after the 50-year placement via syndicate, the XNUMX-year offer will not be made.
According to operators, the total amount could be 7 billion, based on previous mid-month auctions, but there is also the possibility of a lower amount given the 5 billion 50-year bonds placed this week.
GAY (YOUNG INDUSTRIALS) OPENS TO NEW MEMBERS FOR IL SOLE 24 ORE
Countdown in view of the next Board of Directors of the Sole 24 Ore, scheduled for Friday. The president of Young Industrialists, Marco Gay, said that Confindustria wants to remain a shareholder in the publishing group but does not rule out the arrival of new shareholders if the company's financial needs are such as to require the entry of new shareholders.
