The US locomotive slows down. Alarming signs on the economy are once again coming from China, not to mention Japan, lead by the rise of the yen. Not even Europe shines: the European Commission has reduced its GDP growth estimates and consumer prices for 2016 and 2017.
RECESSION CLEAR, DOLLAR AND OIL WEAK
The world is once again breathing an air of recession, despite the propellant of low rates. Among the symptoms of possible contagion are the volatility of oil (yesterday -2,5%, Brent below 45 dollars, before a rebound this morning) and, above all, of the dollar, which yesterday touched its lowest level in 15 months: the yen rises , at 105,5, the euro also rose again above 1,16. The US currency then recovered some positions, but the fear remains, as Giuseppe Sersale, Anthilia strategist explains: “If a too strong dollar strangled China and the Emerging Countries, it is not that the opposite version is of particular benefit to the global picture. What is needed in this phase of fragile growth and evanescent global demand is a balance between currencies, which avoids the accumulation of excessive stresses that end up fueling frenetic capital flows that cause volatility to explode. But it is a difficult balance to achieve, unfortunately ”.
SCARING CHINA AGAIN, ONLY PFIZER SHINES ON WALL STREET
The confirmation comes from the trend of the markets. The Tokyo Stock Exchange closed for a holiday, the concerns of the Asian Stock Exchanges are concentrated on the health of the Chinese economy: manufacturing activity, which has been declining for 14 months, is not picking up again, despite the robust injection of capital (361 billion dollars in March, three times the previous month) to stimulate recovery. Hong Kong -1,1%, also down for Australia (-0,8%) and the other markets in the area. Shanghai (-0,1%) and Shenzhen (+0,2%) were more stable.
The US stocks closed in the red: S&P500 -0,9% to 2063 points (the minimum for three weeks) Dow Jones -0,8%. NASDAQ -1,1%. After the closing came the results of the primaries in Indiana: Donald Trump triumphs in the Republican field. Ted Cruz, the latest rival, has raised the white flag. In the democratic field, Bernie Sander resists, even if the advantage of Hullary Clinton is almost unbridgeable.
On Wall Street, the banks are suffering, caught between low rates and declining profitability. Citigroup drops 2,4%; significant losses also for Bank of America (-2,8%), JP Morgan (-2%), MorganStanley (-1,4%) and Goldman Sachs (-1,8%). Among the positive notes, the rebound of Apple (+1,6%), which interrupted the negative streak. The best stock was Pfizer (+2,8%), in excellent shape after abandoning the merger for tax reasons with Allergan, after the obstructionist maneuvers of the White House.
BANKS HOLDING DOWN EUROPE. MILAN AND MADRID THE WORST
All the European stock markets fell sharply, under pressure from bank accounts and the cut in growth estimates for the eurozone by the EU Commission, which also revised slightly downwards Italy's estimates contained in the Def (1,1% against 1,2%). But the most alarming data concerns the United Kingdom: the manufacturing PMI fell into contraction territory in April to 49,2 points from 51 in March, the lowest since February 2013.
London closes at -0,9%, much better than Milan (-2,4%) and Madrid (-2,5%), crushed by the banks. But the credit crisis did not spare Frankfurt (-1,9%), chilled by the collapse of Commerzbank, down 9% after the accounts. Since the beginning of the year, the loss is 23%, lower only than that of Deutsche Bank. Heavy blow in Zurich for Ubs (-7%). Bnp Paribas (+1,5%) is saved in Paris (-0,5%), the only blue-chip bank in the Old Continent to close in positive territory.
The pressure on debt securities also increases: the ten-year BTP closed at 1,54%. The spread widened to 134 points (+6 bps), due to the surge in securities in the "core" area, in particular the Bund, which fell below 0,20 to its lowest level since December.
WITHIN THE YEAR 100 CHRYSLER TARGATO GOOGLE. FCA FLIES TO WALL STREET
Official confirmation of the agreement between Fiat Chrysler and Google arrived late yesterday evening. After a difficult day for the group's stocks, in line with the decline in the sector, FCA (+3%) took off on Wall Street.
For now, the impact is more psychological than in numbers. FCA is expected to supply around one hundred prototypes by the end of 2016 based on the Pacifica Hybrid minivan, presented at the Detroit Motor Show last January. The models will be built “specifically for Google's self-driving program” reads the official note. It will be only the first phase of a larger joint project for the production of driverless vehicles in the coming years. Working with Google, said Sergio Marchionne "will give us the opportunity to collaborate with one of the major companies in the sector and the experience will be essential for the development of automotive technologies that will bring benefits".
FCA will take care of the design and engineering, Google of the sensors and computers that will guarantee autonomous driving. Beyond the numbers, the prestige counts: it is the first time that a Silicon Valley giant has officially allied itself with a four-wheeled house. In recent weeks, talks with Ford and GM had failed.
The news should also overturn the mood of Piazza Affari today, where Fiat Chrysler lost 3% yesterday, despite climbing above 7 euros in the finale. In the United States, the group sold 6% more than last year in April, reaching its best April in 11 years. But analysts are pessimistic about the near future for the Detroit Bigs.
Ferrari was also bad (-2,4%) despite Equita rewarding the results by raising the target price to 52 euros from 50 euros and confirming the Buy recommendation. In the opposite direction was the decision of Exane BNP Paribas which confirmed the Underperform recommendation, however raising the target price by 13% to 36 euros.
Thump also for Cnh Industrial (-6%). Among the other industrialists, Finmeccanica was weak (-0,9%): the Indian Rotocraft jv was admitted by the Indian government among the companies authorized to invest directly, a sign of thaw in relations with the Asian country. Heavy StM (-4,3%).
BANKS IN FALL. ANGELONI (ECB): ATLAS IS NOT ENOUGH
In a black day for credit, both in the US and in Europe, Italian banks were no exception. The flop of the failed listing of Banca Popolare di Vicenza still weighs heavily, casting ominous clouds over the forthcoming, urgent capital operations as well as the effective support of Atlante on the non-performing loans front.
The confirmation came from Ignazio Angeloni, member of the Supervisory Board of the ECB. While promoting the securitization guarantee scheme and the recent launch of the Atlante fund, Angeloni said that "we shouldn't expect, however, that these two initiatives alone could lead to a breakthrough." Atlante, in particular, "represents a further step in the right direction but with the current reduced size, the Atlante fund will be able to intervene on a maximum of a limited number of small and medium-sized banks".
No illusions for the problems of Monte Paschi (-7,57%): the market, once it has acknowledged that the Atlante fund certainly does not have a bazooka (if anything, a bow with a few arrows) capable of countering bad debts, returns to hit the Tuscan Bank.
The worst stock, out of the Ftse Mib basket, is Carige (-8,07%). Banco Popolare still down (-7,17%), pending the start of the increase from 1 billion: the due diligence for the merger with Bpm (-3,54%) will end on Friday.
Ubi under fire (-5,1% to 3,34 euros). An inspection by Bank of Italy found irregularities regarding the transparency and fairness of customer relations for which a sanctioning procedure would have been initiated.
Down Unicredit (-4,68%), one of the most targeted titles both for the imprudent offer of help to Vicenza (later withdrawn thanks to Atlante), and for games at risk in Italy and outside. Intesa also pays a high price (-2,36%), which will have to support the operation on the capital of Veneto Banca, markedly tightened by the ECB in terms of governance.
TELECOM ITALIA BRAKES ON INWIT. FINMECCANICA MAKES INDIANA
Many dossiers on the desk of Flavio Cattaneo, new CEO of Telecom Italia (-1,1%). The negotiation with Cdp for the exchange between Metroweb, indirectly controlled by the subsidiary of the Treasury, and a share of Sparkle, a profitable and strategic stake of the former incumbent continues: the evaluations of the parties, according to the rumors, are very distant. Meanwhile, it seems that Cattaneo intends to maintain control of Inwit (-0,43%), already put up for sale by the former CEO Marco Patuano. As for Tim Participaçoes' Board of Directors, he will appoint the new top management on 11 May: the new CEO will be Stefano De Angelis.
TENARIS ROLLS, SAIPEM STILL HEAVY
Turbulent day under pressure from crude oil prices. Among oil-related stocks, the worst is Tenaris (-5,3%), which suffered the downgrade of Kepler Cheuvreux to Reduce da Hold. The target drops to 9 euros from 9,80 euros. The company has provided prudent indications for the next quarters: the EBITDA margin for 2016 will fall below 15%, from the 16% previously indicated, also due to the foreseeable increase in the cost of raw materials in the second half of the year.
Eni is also heavy -3%. Saipem -3,2% despite the announcement of a new 1,5 billion dollar contract, of which approximately 1,3 billion pertaining to Saipem. Together with the partners Bos Shelf and Star Gulf, Saipem will carry out phase 2 of the Shah Deniz development project from BP, on behalf of the Shah Deniz partnership, a very large gas field in the Caspian Sea. The contract has a duration of five years with an option to extend for a further five years.
TECHNOGYM, SPRINT DEBUT: FLAVIA PENNETTA AND CANNAVARO ON THE STOCK EXCHANGE
Technogym didn't choose a good day for its debut in Piazza Affari, but the result is brilliant: the gym products company gained 11% at 3,62 euros, after a placement at 3,25 euros. The stock had a sprint start, failing to price at the opening due to an excess of bullishness. The placement had closed with a demand four times higher than the offer.
The debut was celebrated with an event at Palazzo Mezzanotte in which those present, seated on the wellness balls of the Romagna company, were involved in a collective fitness lesson. All the sports testimonials of the company were present, from Fabio Cannavaro to Clemente Russo and Flavia Pennetta.
