The via crucis of Piazza Affari has begun. Here is the bulletin after the first station. In Piazza Affari, the FtseMib index lost 4,8% going to close at the lows of the session. The deterioration coincided with the declarations of Pier Luigi Bersani. The absence of reassurances on the continuation of policies of rigor and reforms, as well as the criticisms of European austerity, were not appreciated.
The yield spread between the BTP and the Bund widened by 51 basis points, reaching 343. The yield on the 10-year BTP rose to 4,88%. Italy has raised fever throughout the eurozone. The London Stock Exchange fell 1,3%, Paris fell 2,6% and Frankfurt finished down 2,2%. On the Stock Exchange, sales mainly hit financial stocks: in Europe the Stoxx index of banks lost 2,9%, insurance companies -2,3%. The euro holds: against the dollar, the single currency was unchanged at 1,3067 (from 1,306) and strengthened against the British pound, rising to 0,8661, from 0,8632. Gold is worth $1.609 an ounce in Asia this morning.
BERNANKE: ITALY, A LOT OF UNCERTAINTY. TOKYO DOWN
A completely different script across the Atlantic. On Wall Street the session closed in positive territory: Dow Jones +0,84%, S&P +0,61% and Nasdaq +0,43%. There are two reasons for the recovery: the good macro data, both on home sales and on consumption trends, and the words of Ben Bernanke heard in Congress. The Federal Reserve chairman defended the bond-buying plan aimed at supporting growth, adding that the public spending cuts that could be triggered this week would be a problem for the economy.
However, the Italian crisis is also worrying the USA as Bernanke said, in response to a question from Senator Charles Schumer: “The market is reacting above all to uncertainty. He does not know where the Italian government will go and how politics will be affected. I'm no expert on Italian politics, but I don't think any of the candidates flatly rejected the idea of staying in the euro or maintaining the policies required of Italy to stay in the eurozone. However there is a lot of uncertainty, let's wait and see what happens”. The Tokyo Stock Exchange fell this morning -1,27%: worrying is the prospect that a euro crisis could frustrate the efforts of the weak yen policy. Hong Kong also down -0,37%.
THE PERFECT STORM ON BTPs
“An Italian comedy turned Greek tragedy”. Angelo Guglielmi of Mediobanca securiities thus summarizes the situation of the Bel Paese after the elections. "There are more uncertainties after the elections than before", notes the London team from Piazzetta Cuccia, one of the voices most listened to by the City on the events of our house in a report entitled "the perfect storm". A storm that could experience this morning one of the main scenes.
In fact, this morning the Treasury will offer in auction from 4,75 to 6,5 billion between the 5-year bond in November 2017, the current benchmark, and the new 2023-year bond in May 3. Of the new bond, in particular, an amount between 4 and 8,75 billion. Hard to imagine more difficult conditions for the auction. Yesterday the offer of 1,23 billion six-month BOTs closed this morning with the placement of the entire amount, but the yield shot up to 0,73% from XNUMX% in the previous auction at the end of January: from yields weren't that high last October.
Yields are expected at today's auction not far from the peak of 5 percent. In a nutshell, half a point more spread, more or less what is happening, on the entire stock of public debt would cost the Treasury about 10 billion euros more in interest rates per year, or half the Imu. This situation also weighs on the other countries of the periphery which, through our fault, have to bear a rise in their spreads against Germany: +20 bps for Spain, +30 bps for Portugal, +25 bps for Greece. It should be noted that the Italy/Spain spread narrows to 49 basis points, the lowest level since the beginning of September.
PITCHES IN THE BUSINESS PLACE
A tsunami of sales hit the financial sector, starting with the banks. The ban on short selling issued by Consob was of little use. Unicredit sank in a drop of 8,4%, Intesa -9%, Pop.Milano -5,7%, MontePaschi -5,8%, Banco Popolare -10%. Mediobanca -7,5% closed the second quarter of the 2012-13 financial year with a net profit of 14,8 million, above the consensus gathered by the bank which indicated a loss of 10 million and despite the write-down of the investment in Telco for 95 millions.
Among European banks, Société Générale lost 5,8%, DeutscheBank -4,9%, Spain's Santander fell by 4,6%. Among the insurance companies, Generali lost 6,5%, Unipol -11%, Fondiaria-Sai -9%. In asset management, Azimut lost 4,4%, Mediolanum -10%, Banca Generali -6,2%. Among industrial stocks, Fiat -3,4%, Finmeccanica -3,9%, Fiat Industrial -2,7%, StM-3,4%. Enel fell by 5,8%, Eni lost 3%, A2A -8%. Telecom Italia closed down by 2%. Among the Milanese blue chips, only two stocks closed positive: Diasorin +0,1% and Pirelli +2%, while the parent company Camfin returned to growth (+4,9%). Thus the rumors about a future arrangement of the puzzle of the Tronchetti Provera galaxy resume.
Mediobanca closed the second quarter of the 2012-13 financial year with a net profit of 14,8 million, above the consensus gathered by the bank which indicated a loss of 10 million and despite the write-down of the investment in Telco for 95 million. The first half therefore shows a net profit doubled to 123,8 million against 63,4 million a year earlier. The contribution of the consolidated equity-based companies increased, rising to 85,8 million thanks to the largely non-recurring contribution of Gemina (27,2 million) which compensates for the operating losses of RCS. The contribution of Generali also increased (75,6 million from 65,9 million).
In addition to the write-down of Telco which brings the value in use of Telecom shares to 1,20 euros, the securities and equity portfolio also saw write-backs on Greek government bonds of 12,2 million and other write-downs on securities available for the unlisted sale for 6,7 million.
