Certain numbers have an evident symbolic value, beyond the practical effects. No manager, for example, will be tempted to invest customers' savings from the 13 euro cents that the 5,7-year German Bund pays. But the news of the end of the sub-zero rate era in Berlin on the day when inflation jumps to XNUMX% will undoubtedly have a psychological impact on the ECB's interest rate policy.
More difficult to assess the weight of the Nasdaq correction. Yesterday evening on Wall Street the technological stock closed down by 1,1%, at 14.340 points. Since the maximum for the period is more than 10%, the index has technically entered the "correction" area. The consequences? In recent years, buying on the correction has proved to be a good opportunity, but if you look at the entire history of the Nasdaq, about half a century, there are also several cases of entering the correction phase that anticipates the arrival of the bear market: from 1971 to today, this has been the case in 37% of cases.
HONG KONG RISES AGAIN, TOKYO'S EXPORTS +17,5%
In the meantime, Taurus, in search of refuge, returns to look at Asia, which is recovering after a difficult year. The credit easing announced by the Central Bank of China tonight sent Asian Pacific stocks higher tonight.
The Hong Kong stock market reacted the most to the reference rate cut by the People's Bank of China, with the Hang Seng index up 2,6%. We like the news that Masayoshi Son, the Japanese tycoon, has chosen the market for the next quotations. High-growth companies such as Alibaba and Tencent are up, both +4%.
The other markets were positive: Tokyo's Nikkei +1,3%. Japan's exports rose last month by 17,5%, the consensus was expecting +15%. Kospi of Seoul +0,5%. BSE Sensex of Mumbai -0,5%.
WELL THE ACCOUNTS OF MORGAN STANLEY AND BOFA
Futures on the US markets rose this morning, after a session in the red: in addition to the drop in the Nasdaq, losses in the order of 1% are to be recorded for S&P and Dow Jones.
Procter & Gamble stocks advanced (+3,4%). Better than expected Bank of America and, above all, Morgan Stanley (+1,5%).
THE DOLLAR FALLS, OIL REMAINS AT HIGH
The 1,85-year Treasury Note was little moved at 2023%. Movements of little significance also on the currency market: the dollar index is slightly down for the second consecutive day. There is a growing sense that the ECB won't wait beyond XNUMX to start raising interest rates.
Brent and WTI oil, fresh from three consecutive rising sessions, moved little but remained at their highest levels since 2014. The America Petroleum Institute calculates for last week an increase in US crude inventories of about 1 million barrels.
TESTS OF UNDERSTANDING ON UKRAINE. THE GOLD AWAKENS
Spotlight on Ukraine. President Biden yesterday hinted that Washington will limit itself to financial sanctions if Putin limits himself to demonstrative force. The intervention has aroused violent criticism: the White House risks an encore after the tragic retreat from Kabul. Moscow, for its part, winks. Russia's Deputy Foreign Minister Sergei Ryabkov said about Ukraine that there is no risk of large-scale war.
Gold woke up from its torpor yesterday, gaining 1,50%, with the price rising to its highest level since mid-November. The interest in the precious metal may be linked to the flattening of the US Treasury yield curve.
EVEN THE ECB OPENS TO THE POSSIBILITY OF RAISING RATES
European stock exchanges recovered from the lows of the opening, in line with the recovery of Wall Street futures and closed higher, excluding Piazza Affari. But, after Italy and Germany, UK data also compounded inflation concerns, hitting a 30-year high and once again beating expectations in the process. Even the ECB, beyond the official declarations, opens up, if necessary, to the hypothesis of a mini-tighten. This was admitted by the governor of the Bank of France and member of the ECB board Francois Villeroy de Galhau. Speaking online at the World Economic Forum in Davos, Villeroy said ECB monetary policy should be aimed at ensuring that inflation falls quickly and stabilizes around the 2% target, compared with the 5% target seen in December in the euro zone. “We think the phased approach is best. But we are open to any option, as long as it is based on data”.
INFLATION RISES: GERMANY +5,7%, LONDON AT THE TOP SINCE 1992
In the meantime, the increase in market rates is picking up speed. During the session, the yield of the German bond also revised the plus sign as it had already happened yesterday, and then fell back slightly negative. The 15-year bond was placed at 0,15%,
A boost was given by German inflation, harmonized on the basis of European parameters, which rose to 5,7% in December, while the national consumer price index stood at 5,3%. The data, announced the National Statistical Institute, confirm the provisional estimates. On a monthly basis, prices increased by 0,3% compared to the EU parameters and by 0,5% in the national index.
SPREAD TO 140, FRANKFURT MINUTES TONIGHT
The rate of the BTP closed at +1,35% and that of the Bund at -0,05%. The spread between 10-year BTPs and Bunds of the same duration is 140 basis points, +2,06%.
In anticipation of next week's Fed meeting, today investors will read the minutes of the latest ECB meeting in search of any indications on Frankfurt's future moves. Eurozone money markets now expect interest rates to rise by 10 basis points in September 2022, rather than by the end of the year as assumed just last month.
THE BLACK JERSEY IN MILAN (-0,47%). 2022% GROWTH IN 4
Milan loses momentum: -0,41% to 27.370 basis points, the only listing in the red in a moderately positive European context. Italy's economic growth, after having "lost strength in recent months", could "return to sustained expansion in the spring, mainly driven by domestic demand", closing 2022 with growth "close to 4%". The president of IVASS and general manager of Banca d'Italia, Luigi Federico Signorini, speaking at a Swiss Re event, said he was rather confident about the economy's prospects.
Thus Paris +0,55%, Frankfurt +0,2%; Amsterdam +0,37. Madrid is flat. In London (+0,4%) the Pound moved to its highest level since March 2020 in anticipation of an increase in anti-inflation rates.
LUXURY SAVES EUROPE: CARTIER MAKES RICHEMONT FLY
The revival of the luxury sector, which is not limited to Paris, is supporting the markets of the Old Continent. Richemont +9,3% runs in Zurich, the parent company of Cartier and major watch brands, which records a sales boom (+35%) in the last quarter. The hard luxury frontrunner said strong demand for jewelry and watches in the Americas and Europe helped sales climb to 5,658 billion euros. Sales of jewelry brands Cartier, Buccellati and Van Cleef & Arpels rose 38%, while sales of specialty watch brands including IWC and Vacheron Constantin rose 25% from the same period a year ago.
The Burberry stock also shines (+35% revenues) up 5,9%. Meanwhile Hermès, Kering and Lvmh are leading the rises on the Paris stock exchange with increases of around 2%. Also in evidence Essilor Luxottica +1,5%.
TELECOM ITALIA AT A MINIMUM, THE KKR TENDER OFFER IS AWAY
The setback in Piazza Affari is linked to the drop in Telecom Italia: -3,7%, on the lows for two months, among other things penalized by the Barclays report after that of Exane. The market believes less and less in KKR's takeover bid: the shareholders' meeting of 7 April could be called to vote on the break up of the group into two entities.
PRYSMIAN IN THE SIGHT OF THE GERMAN ANTITRUST
Negative session for Prysmian (-2,2%) which was affected by the news on the inspections carried out by the German antitrust on some plants of the group in Germany to ascertain a possible coordination for the determination of the surcharge on metals.
Losses exceeding 2% also for Stm and Recordati.
MONCLER RUNS, SAIPEM BEST OIL STOCK
The recovery of luxury is also taking place in Milan: Moncler +3,2%, Brunello Cucinelli and Tod's are also on the rise. In contrast Ferragamo: -1%.
The oil sector is always positive: the pink jersey is Saipem (+3,7%), followed by Eni (+1,1%). On Parity Tenaris.
Widespread losses among bankers; Intesa Sanpaolo -1,6%, despite the increase in the target price by Mediobanca Securities.
CITIGROUP CUTS GENERALS TO NEUTRAL
Generals -0,7%. Citigroup downgraded Generali's rating to "neutral" from "buy". The target price goes from 21,2 euros to 19,8 euros.
Of note is Mfe-Mediaset (-0,82%): the group is evaluating the possibility of presenting an offer for the three television channels in France put up for sale by TF1 and M6 as part of the process to obtain the go-ahead for the transalpine antitrust to the integration between the two groups. The potential deal is considered by analysts to be interesting even if not relevant from a transformational point of view and for the group's consolidation strategies.
Weak Amplifon (-0,5%) on the launch day of the treasury share buyback programme.
LANDI RENZO (+9,45%) AND TINEXTA (+6%) GO SHOPPING
Landi Renzo runs (+9,45%) after the acquisition of Idro Meccanica, a leading Italian company in the segment of the supply of mechanical-hydraulic technology compressors for hydrogen and biomethane. The operation, writes Equita, allows the group "to have access to a complete portfolio of innovative compressors known on the market and to a large customer portfolio". The M&A also drags Tinexta upwards, up by around 6%, following the announcement of the purchase of 70% of the Spanish company Evalue Innovation.
