30 years have passed since Black Monday (October 19, 1987), when the Dow Jones index dropped 22,8% of its value under the pressure, for the first time, of automatic orders. Since then, the weight of the virtual economy has grown exponentially, the real protagonist of the current market rally.
One of the absolute champions of the new era is undoubtedly Netflix, protagonist of a record quarter. The accounts, announced after the closing of the lists, signal the boom in subscribers (6,3 million in three months, of which 4,45 million in Asia and Europe) and in revenues, which have reached nearly 3 billion dollars (+30 %) even before the recent increase in subscription fees. Results rewarded by the market, which after the Stock Exchange pushed the share up by 2% beyond the highs recorded during the day; in 2017 the increase was 64% so far. Thanks to these numbers Netflix is about to win the battle of content: in 2018 8 billion dollars will be invested in new productions to beat the old competition (the Hollywood majors, Walt Disney) and new (Apple has just enlisted Steven Spielberg, beat Amazon movies coming soon).
By chance, Netflix's challenge took shape on the day of golden power, the rule imposed by the government for Bolloré-branded Telecom. Among other consequences, the provision could accelerate the transformation process of the former incumbent, favoring the integration of "half of Telecom (orphan of the network) into Vivendi, and the alliance with the "enemies" of Mediaset, the last chance to collect at least the crumbs of the cake in the hands of Netflix and company.
This morning the Japanese stock market is about to close higher: Nikkei index +0,2%.?
On the eve of the Communist Party of China congress, Chinese stock markets are up. Hong Kong +0,2%, CSI300 index of Shanghai and Shenzen stock exchanges +0,2%. Seoul +0,2%. Mumbai -0,2%.
APPLE SHINE BACK. YELLEN GOES TO TRUMP
The Netflix boom was just one of the ingredients of yet another day of records, favored by the rally of telecoms (+0.9%) and financials (JP Morgan +2,1%). The Dow Jones index +0,3% touched for the first time in closing the top of 23 thousand points (22.956,96), S&P500 +0,1% (high of 2,559,47 during the day). The Nasdaq closes at 6.632,50, another record.
The sharp rise in the New York manufacturing industry index also favored the rise, reaching its highest level since 2014 at 30,2 points, clearly above economists' estimates (20,75 points).
In the tech list, Apple shines +1,5% after the promotion from sector weight to overweight by KeyBanc: according to analysts, the market underestimates the impact of the iPhone X.
In the meantime, the totonomine for the Fed is picking up speed. President Donald Trump will receive Janet Yellen next Friday. It will be the second meeting since Trump's appointment to the White House. Thus the president completes the round of eligible candidates: in recent weeks he has seen Kenneth Warsh and Jerome Powell, the other candidates together with Gary Cohn.
IRAQ PUSHES OIL, ARAMCO GIVES UP THE STOCK EXCHANGE
Oil up after the advance of Iraqi forces in Kirkuk, wrested from the Kurds: a barrel of WTI rises by 42 cents to 51,87 dollars a barrel, Brent +1,1% to 57,8 dollars. The Baghdad offensive is the response to the September 25 referendum in which the Kurds voted in favor of independence (over 92% said yes). Meanwhile, Saudi Arabia has renounced the listing of Aramco, the giant that controls Saudi oil: Ryiad will proceed with the private placement of one or more minority shares. It is a new setback for Theresa May, who had undertaken to facilitate the listing of the giant with the City to partially compensate for the post-Brexit exodus.
?
Eni?+0,2%,?Saipem?+1% and?Tenaris?+0,1% rise in Piazza Affari.
?
??AIRBUS DETECTS BOMBARDIER. WAR ON BOEING
The trade war between the US and Europe seems ever closer. Yesterday Airbus announced the purchase of the majority of Bombardier, the Canadian group punished by US tariffs in the order of 300%, a measure to protect Boeing. The Québec company will thus be able to develop the C-130 line, jeopardized by Boeing's recourse to Washington's protection. Meanwhile, protests are growing in Brussels over the US strategy which, according to the accusations, has substantially hindered the activity of the WTO since Trump's arrival.
CATALONIA IS HOLDING BACK EUROPE. TODAY THE ZEW INDEX
The Spanish unknown, even more than the advance of the populists in Austria, has put pressure on the financial markets of the Eurozone which are trying to anticipate the next moves of the ECB. This morning the Zew index on the expectations of investors, analysts and entrepreneurs in Germany is published.
?
The euro weakens to 1,179 against the dollar, from 1,182 at the close.?
?
Piazza Affari closed just above parity, +0,07%-
Little moves Frankfurt +0,09% and Paris, +0,21%; London slightly negative, -0,11%.
In Europe, the STOXX 600 index is just above parity but the Madrid Ibex is down 0,88%. During the day there was an exchange of letters between Madrid and Barcelona. The president of the Catalan region, Carlos Puigdemont, reiterated that he has the mandate to be able to move forward on the path to independence, but he also repeated that he intends to negotiate the terms of the separation with the central government. In the reply letter, written in his own hand, the Spanish premier Mariano Rajoy orders him to stop the process: the new ultimatum expires at 10 on Thursday. The news that the Spanish prosecutor's office has requested the arrest without bail of the head of the Catalan police, Josep Lluis Trapero, under investigation for sedition, reports a spokesman for the High Court who confirms what was disclosed by a legal source.
?
The Paris Stock Exchange rose by 0,2%, that of Frankfurt by 0,1%.
?
BTP RATE DOWN, AUCTION DAY FOR FRANCE AND SPAIN?
The Council of Ministers approved the Budget law for 2018, the cornerstones of which are the freezing of VAT and excise duties, the decontribution for new permanent hires and the resources for the renewal of contracts in the public sector that have expired for many years
?
?The Italian secondary sector recovers the drop in the first part of the session, closing in positive territory.
In closing, the yield differential between the BTP and the Bund on the 10-year segment stood at 167 basis points. The 2,04-year rate fell to 2,06%, to its lowest level for almost a month, from 0,38% at the last closing. The Bund drops to 0,40%, from XNUMX% at the close.
The yield on the Spanish 1,569-year benchmark fell to a four-week low of 1,587% (from 120% at Friday's close) while the Spain-Germany spread stood at 46 points, on Friday evening's closing levels, and the Italy differential -Spain at 47 points from XNUMX in the last closing.
Auctions in the eurozone are set to affect the market in the coming days. Today Germany will offer 4 billion in government bonds maturing in September 2019 and Spain 3-4 billion in 3 and 9 month bonds.
On Thursday, however, Paris will make available to investors between 6 and 7 billion in OATs maturing between 2021 and 2024 as well as 1,25-1,75 billion in medium-long term bonds. In the same morning, Madrid will offer between 4 and 5 billion in securities maturing between 2021 and 2046.
TELECOM PAYS THE GOLDEN POWER
?
?Telecom Italia blamed the blow, albeit foreseen, on the use of the golden power by the Italian government. Next Friday, CEO Amos Genish will have his first meeting with Minister Carlo Calenda. The theme of the meeting was a pact on the network: does the project envisage the creation of an infrastructure company ?in which it is possible to carry out the unbundling through a demerger of the infrastructure which could then be opened to new shareholders including substantially public entities such as CDP and Open Fiber.
?
It closed just above Enel parity. Kepler-Cheuvreux analysts have raised the target?price of the stock, bringing it to 5,80 euros from the previous 5,50 euros. Italgas -1%.
StMicroelectronics advances +0,7% to 17,03 euros, one step away from the highs of the last 13 years marked in October at 17,34 euros on the wave of the sector's record performance: The Sox index of the main producers listed in the USA jumped to its highest level since March 2000: +34% since the beginning of 2017. ?Equita adjusted its target price to 17,80 euro from 17,0 euro. Hold judgment confirmed.
?
Campari sets a new absolute record + 1,9%.
ALSO BANCO BPM “HOPES” IN THE BUFFETT EFFECT
Among the banks, Banco Bpm took off +3,5% on the eve of the choice of the bancassurance partner. Favored by Cattolica Assicurazioni +2%, which recently included Berkshire Hathaway, Warren Buffett's company. The Veronese company, if chosen by Giuseppe Castagna, will have to carry out a capital increase to support the new business. It will be an opportunity to transform the company into a spa. But at that point, according to gossip, a merger between the bank and the company capable of giving life to a new financial hub could not be ruled out. ??
Popolare di Sondrio gains 1,3% after signing a non-binding letter of intent with the Cassa di Risparmio di Cento Foundation aimed at investigating the possible acquisition of the majority of Cassa di Risparmio di Cento. Among the other banks, Bper also performed well ??+1,09% and ?Ubi Banca?. +0,98%.
?
SUFFERING IS GOOD FOR CERVED AND DOBANK
In the rest of the list:
?
Cerved stands out +2,4%. The company will play a significant role in the management of Monte Paschi's 26 billion euro non-performing loans through the management platform Sirio, (owned together withQuestio) which was awarded the management of 50% of the portfolio.The transaction which could be worth 4 million euros of Ebitda when fully operational, additional to the current estimates of analysts, is added to the one recently signed with Creval.
Non-performing loans are also good for Dobank +6,2% to new highs with volumes more than twice the daily average. The company would have been awarded the servicing contract for part of the maxi securitization of MPS bad loans. Based on the size of the contract, Banca Akros revised the 2019 adjusted EPS and the target price to 13,5 from 12,5 euro, confirming the "accumulated" recommendation on the stock.
NETFLIX EFFECT ALSO FOR MONDO TV
The Oscar of the day undoubtedly belongs to Mondo Tv +14% to 5,72 euros, the highest since March 2016. The company of editorial content for television will produce a TV series based on the character YooHoo with Netflix and other partners. ?The series, produced in 3D CGI animation, will be co-produced by Netflix, Aurora and Mondo TV and broadcast worldwide by the end of 2018 by the US partner.??
