Positive start of the Asian lists on the wave of positive data arrived on Friday from the USA. Tokyo rises (+0,2%), despite a new strengthening of the yen. Korea and Australia are also doing well. Chinese and Hong Kong markets closed for the Ching Ming holiday.
US employment is growing at a rapid pace. The other macro data also confirm that the American locomotive, without jerks, is picking up speed. But the markets are not afraid that the recovery will translate into an immediate rise in rates. Indeed, according to the Bloomberg panel, the levels of Fed funds and other indicators suggest that the Fed will not even move in June. The US central bank meeting, scheduled for June 14-15, will precede the British referendum on Brexit by a week, which the US is viewing with great concern. This forecast is supported by the weakness of the dollar accompanied by the fragility of the other areas of the global economy.
PUTIN, MESSI AND PLATINUM OF THE WIKILEAKS NETWORK
At the center of world attention today is the Panama Papers, or rather the scoop published on Sunday by the Suddeutsche Zeitung in collaboration with 100 other newspapers from all over the world thanks to Wikileaks and the International Consortium of Investigative Journalists: 11 million documents, obtained by a secret informant at the Panama-based law firm Mossack Fonseca, which managed and manages the offshore fortunes of the world's greats. Among the VIPs involved numerous politicians such as Vladimir Putin or David Cameron or sportsmen such as Leo Messi or Michel Platini. Italians? According to L'Espresso (the newspaper adhering to the pool) there are about 800. Among these, the name of Luca di Montezemolo appears together with those of Unicredit and Ubi. Australia has already announced this morning that it has begun tax audits of 800 prominent taxpayers featured in the documents.
OIL, CHINA AND THE MINUTES OF THE FED AND ECB
The agenda for the week foresees the publication, on Wednesday, of the minutes of the last meeting of the Fed. In the meantime, an unprecedented meeting will be held on Thursday: at the International House in New York, the last four presidents of the Fed will speak: GDP Volcker, Alan Greenspan , Ben Bernanke and of course Janet Yellen.
Expectations are rising for the Doha summit on 17 April which should ratify the agreement between OPEC and non-OPEC oil producers to set the production ceiling at current levels. But the road is uphill: Russia, in particular, in March reached its maximum production of 10,91 million barrels, a record since 1987. Saudi Prince Meohammed bin Salman warned on Friday that the agreement will be made only if everyone, including Iran, will adhere to it.
The minutes of the historic directorate of the ECB in March will also be released on Thursday, an opportunity to evaluate the attitude held by the hawks, including the president of the Bundesbank Jens Weidmann, who did not vote on that occasion.
Among the most awaited data are those arriving from Beijing: trade balance, bank credit and foreign currency reserves, which have been in sharp decline for months in the face of maneuvers to defend the yuan exchange rate.
On Friday, the Italian government could approve the new economic and financial document with the downward revision of growth estimates and the increase in the deficit: the request for new flexibility from the European Union is likely.
POSITIVE EXPECTATION FOR THE DEFLATION-PROOF BTP
From today the volume of fire of the ECB increases. The Frankfurt institute will buy 80 billion bonds in April (against the 60 expected so far by the Qe). Only in May will Mario Draghi's bazooka be extended to corporate bonds. Hence the forecast of growing pressure on government bond prices.
The framework seems to have been set to guarantee the success of the number one edition of the BTP Italia, which starts from this morning until Wednesday 6 for the retail public. Thursday purchases will be reserved for institutional operators.
Last Friday, the Treasury announced that the minimum guaranteed annual real rate (coupon) on the 2016 BTP Italia with a maturity of 2024 is 0,4%. Demand, according to forecasts, should be high given the minimum guarantee of the coupon and the protection of capital against the risk of deflation (minimum interest is envisaged even in the event of below-zero inflation). Furthermore, the fact that last week the coupons envisaged by the first BTP Italy of 2012 were paid contributes to supporting demand: 7,3 billion euros which could be reinvested in the new bond.
In 2016, another two Btp Italia issues will expire: in all, it is 27 billion out of the 103 billion raised so far with this formula, about half from retail.
THE MEDIASET-VIVENDI AXIS IN THE SPOTLIGHTS
The axis between Mediaset and Vivendi will be officially born on Wednesday. The subsidiary Fininvest will acquire 3,5% of the French company (market value around 900 million) which, in turn, will acquire 3,5% of the Italian group (around 150 million). The difference will be made up by the sale of Mediaset Premium ("we have no intention of leaving pay TV", CFO Marco Giordani assured during the balance sheet meeting on 22 March). Vivendi will also acquire the 11% held by Telefonica. The agreement will not stop at the financial aspect but will also invest in the production aspect and the creation of digital platforms with the aim of countering the advance of Netflix.
KEPLER RETURNS TO BETTING ON TELECOM ITALIA
Spotlights turned on today also on Telecom Italia, in perspective involved in the operation between the two players after the appointment as CEO of Flavio Cattaneo, former RAI administrator in the Berlusconi era. The stock restarts after having lost 9,6% in four sessions. The failure of speculative expectations on possible changes in the shareholding after Vivendi reached 24,9% of the capital weighed heavily, but also the failure of the negotiations between Orange and Bouygues Telecom, the possible first step in the risk of European telecommunications.
Meanwhile, there are those who consider the drop in Telecom Italia stock an excellent buying opportunity. Kepler Cheuvreux issued a note to customers reiterating the Buy recommendation and the target price at 1,1 euro. According to the French broker, the appointment of the new managing director Flavio Cattaneo could have positive effects on the listing, because it will lead to an acceleration in cost cutting. Furthermore, under Cattaneo's leadership, Telecom Italia could decide to exit Brazil with a two-step plan: first the merger between the subsidiary Tim Brazil and Oi, then the sale to Vimpelcom of the stake in the company that will result from the merger.
SIX BANKS HAVE LOST MORE THAN 10% IN 5 DAYS
Banks remain at the top of Piazza Affari's agenda and concerns. During the week, the worst sector in Europe was the credit sector (European Stoxx -4,8%), above all due to the responsibility of Italian institutions. Over the past week, the securities in the sector were in fact at the bottom of the rankings: Banco Popolare -21%, MontePaschi -16%, Banca Pop.Milano -15%, Ubi -14,5%, Unicredit -13,3%, Banca Pop.Emilia -10,6%.
UBI, THE MAJORITY GOES TO THE FUNDS
At last Saturday's UBI meeting, the first since the transformation into a joint stock company, the list presented by the investment funds obtained the majority with 51,11% of the votes against 48,45% of the list presented by the historic shareholders of the old cooperative. The top management has been confirmed (Assogestioni has proposed only three names for the board of directors) but institutional investors have asked for a "sign of discontinuity" in the name of the market. On the subject of M&A, CEO Victor Massiah said, there are no open dossiers today. "A merger is not in itself a good deal," he said, adding that "successful deals are relatively rare."
INCREASES: TODAY FIRST TEST FOR BANCO POPOLARE
Banco Popolare is also in the spotlight. The board of directors approved the one billion euro capital increase envisaged in the merger agreement with Bpm which it intends to launch, market conditions permitting, by the end of June. The operation will be submitted to the extraordinary shareholders' meeting on May 7th.
Countdown to the one billion euro capital increase by Popolare di Vicenza which, unless postponed, will start on April 18th. Unicredit is heavily involved (-13,3% during the week). The guarantee contract, in fact, signed about 6 months ago, provides that Unicredit is the sole guarantor of the operation. Assuming that Unicredit remains with an unopted share of 20% and on this share it must record a loss of 50% - equivalent to a valuation of Banca Popolare di Vicenza equal to 0,18 times the Tangible Equity - the impact for Unicredit would not be greater to 130/140 million euro (also taking into account the commissions generated by the guarantee provided to Banca Popolare di Vicenza).
THE WEAK DOLLAR SUPPORTS WALL STREET. MILAN THE WORST BAG
Wall Street stocks have completed the recovery of the losses incurred in the first two months of 2016. The S&P 500 index reports a modest rise (+0,8% compared to the beginning of January). The attention of operators is already directed to the accounts of corporate America for the first three months: the first boards (alcoa will open the fashion show as usual) are scheduled for next week.
The recovery of the US market is also linked to the slowdown in the dollar which lost 1,8% against the euro during the week. Despite the official reassurances, the game of central banks continues to weaken their currencies to encourage exports from their countries. The ECB and the Bank of Japan continue to print money and the Fed, which announced in December that it would make four rate hikes in 2016, is now saying it will make a maximum of two, or maybe just one.
The overall index of the Stoxx 600 European stock exchanges lost 0,6% during the week, the loss since the beginning of the year is 9%. In Piazza Affari, since the beginning of 2016, the loss is 17%, the heaviest among the markets in the OECD area.
