The new heavy drop in oil characterizes the start of the financial day. Crude oil is slipping to new lows this morning: Brent at 46,55 dollars a barrel, further down on yesterday (47,40 dollars, -5,5%) already at the lowest levels for five and a half years. The cut in Goldman Sachs' 2015 price estimates contributed to accelerating the downward push: from 83,75 to 50,40 dollars for Brent and from 73,75 to 47,15 dollars for Wti. Société Générale also reduced its forecasts: Brent from $70 to $55 and West Texas from $65 to $51.
There are two immediate effects on the financial markets: the pressure on energy stocks; a new push towards deflation, with immediate repercussions on the cost of money. In Tokyo, this morning, the 5-year government bond fell to zero yield for the first time. The Stock Exchange, closed yesterday for holidays, is experiencing a sharp decline, in the order of 2% on the wave of the recovery of the yen against the dollar: the data on US employment have pushed back the increase in US rates. On the other hand, Chinese lists rose: Hong Kong +0,5%, Shanghai +0,3%. The better than expected trend (+9,7%) of exports from Beijing contributes to favoring the increase.
US QUARTERLY, STARTING OK. BUT WALL STREET GOES DOWN
The US quarterly season is off to a good start: the aluminum giant Alcoa closes with better-than-estimated earnings. But Wall Street is waiting to see the effects of the strong dollar on the balance sheets of multinationals. Heavy fall yesterday for Tiffany (-11,6%) after the revision of the forecasts. At the end of the session, the Dow Jones index fell by 0,4%, the S&P 500 by 0,6%, the Nasdaq - 0,84%. The dollar strengthens again against the euro, which drops to 1,182 from 1,184 at yesterday evening's closing: the cross is sailing close to the minimum of the last nine years.
EUROPE GOES UP WAITING FOR DRAGONS. BTP AUCTION TODAY
The slowdown in US price lists has partially conditioned the European price lists, now concentrated while awaiting the decisions of the ECB. Tomorrow, simultaneously with the opinion of the Advocacy of the EU Court of Justice on the legitimacy of OMTs, Mario Draghi will speak in Germany at the Die Welt conference. In Milan, the Ftse Mib index closed up by 0,95% at 18.349 points after reaching a maximum of 18.429 and a minimum of 18.031 points in the early afternoon when it had lost 0,2%. Similar trend for the other European Stock Exchanges: Frankfurt gained 1,38%, Paris 1,18% and Madrid 0,81%, while London closed unchanged at 6.501 points. Tech (Stoxx of the sector +1,8%) and Automotive +1,7% rose on the European stock markets.
Positive day for the BTP which sees the yield drop to 1,80% from 1,87% yesterday. The spread with the Bund narrows to 132, down by 6 basis points. 3, 6 and 15-year BTPs are going to auction this morning for a total amount between 5,5 and 7 billion euros.
THE SAIPEM LANDSLIDE ACCELERATES -9,7%
The drop in crude weighed on oil stocks. Exxon and Chevron retreat on Wall Street, both at -2,3%. In Europe, the Stoxx index for the sector falls by 1,3%. But the slowdown saved Eni yesterday, which rebounded by 0,5% after last week's sharp declines. On the other hand, Tenaris fell sharply (-2,5%).
However, the hardest hit was Saipem (-9,8%), which slipped to the new lows since August 2004 at 7,20 euro, after closing last week with a drop of 9% and touching, during the session , a price of 7,0850 euros. It was of little use that Goldman Sachs confirmed the stock in its Conviction Buy List (stocks to buy without hesitation) also because new "punishments" have arrived from other brokers: Canaccord Genuity cut the rating to Sell from Hold, lowering the target price at 7,50 euros from the previous 13 euros. Barclays has almost halved its target price to 12 euros from the previous 20 euros, with an Equal Weight recommendation.
FCA AND PIRELLI SPRINT. MARCHIONNE: NEW MERGER NEEDED
Great day for car stocks: the sector index (+1,7%) is at the top of the Eurostoxx. Fiat Chrysler +2,5%. In Detroit Sergio Marchionne announced the return of all 5.418 layoff workers at the Melfi plant and over 1.000 new jobs in the next three months, thanks to good sales of the models produced (Jeep Renegade and 500 x). For 2015, Marchionne sees the auto sector growing, but in single digits, in the three areas where the group has a strong presence, Europe, the United States and Brazil.
The group has confirmed the forecasts of the industrial plan for 2014, in view of the results that will be released shortly. Ferrari is a candidate to be a "luxury good" and Marchionne is hoping for a listing in the first half of the year. The group, Marchionne said, is not in talks with a possible partner for integration, but the CEO reiterated that the sector needs further consolidation. Cnh Industrial also performed well (+3,2%).
Pirelli gained 2,7%. Mediobanca confirms the Outperform recommendation and the target price at 14 euros. The leading group in the production of tires has announced that it has signed an agreement with a group of banks for a new revolving credit line and a multicurrency term loan for a total value of one billion euros with a five-year duration. The loan replaces (in advance) a previous line expiring in November 2015 for 1,2 billion.
BANKS, THE BIG BOUNCE. CARIGE COLLAPSES
Banks absorbed, in part, the losses from Black Friday. Intesa +2,2%, Unicredit +1,1% and Banca Pop.Milano +1,4% rose. But there are also banks in decline: Monte Paschi -2,6%, Banco Popolare -2%. Lastly, Banca Carige sank (-11,4%) to 0,0615 euro after the news that Consob had decided to take the bank to court to force it to cancel the resolution approving the 2013 financial statements.
Nonetheless, the stock retains a 13% gain from January 1,01 to today. Azimut (-5,6%, funding of 2014 billion in 115, 0,45 million in December) and Banca Generali (-4,02% funding of 333 billion in the full year and XNUMX million in December) were down.
ADVANCE ATLANTIA. CHINA PUSHES CUCINELLI
In the evening Brunello Cucinelli (+2%) released the 2014 figures: revenues up 10,3% to 355,8 million. All markets from North America (+12,7%) to Europe (+8,2%) to China (+32,7%) and the rest of the world (+15,9%) improved. Italy is more modest, growth of 2,8%. During the year, the debt increased from 16,1 million at the end of 2013 to the current 43 million.
Atlantia rose by 2,7% on rumors of a possible entry into the shareholding structure of new important shareholders. Autogrill (+2,3%) and World Duty Free (+1,5%) were also brilliant. Money on Mediaset (+1,24%): Berenberg raised the target price from 3,65 to 4,05 euros, confirming the buy rating. Telecom Italia also performed well (+1,35%) which launched an offer for the repurchase of its own bonds maturing in 2015, 2016 and 2017.
Also positive was Salini Impregilo (+1,64% to 2,856 euros) which signed the loan deed for the third lot of the Genoa-Alessandria pass for 607 million euros. Finally, among the luxury stocks, Safilo collected 6,60% at 11,15 euros following the news that Hal (a shareholder of Safilo) had decided to list GrandVision.
