Prime Minister Passos Coelho's affirmation of Portuguese policies represents a promotion of the austerity policies, adopted with great seriousness by Lisbon in the last 4 years. The response from the polls was anticipated by the growth of the Stock Exchange (+1,27%), a whisker ahead of Milan (+12,5%), second only to Dublin (+16,6%) during 2015. The result will give new breath for the public debt securities of the periphery of the Eurozone.
US QUARTERLY REPORTS LAUNCH. AND GOOGLE BECOMES ALPHABET
The budget championship resumes. On Thursday, as per tradition, Alcoa will start the publication of the quarterly reports of Corporate America. Despite the slowdown on Wall Street (the S&P 7 index -500% since July) operators fear that a marked slowdown in profits could cause further declines. Thomson Reuter's forecast is that earnings, under pressure from the strong dollar and fewer purchases of emerging markets, are down 4,2%.
Google's new life begins this morning. The stock will be renamed as Alphabet, the holding company that brings together Google internet business (to which we owe practically all the revenues) distinct from all the other projects of the group, halfway between the vision of the future and the current business: Sidewalk Labs, dedicated to the development of the smart city, Nest, which instead works around the smart home. The biotech Calico works in the search for the elixir of life, together with Google Life Science, Google Capital and Google X. Without forgetting the self-driving car project and the creation of a network of high-altitude balloons to connect via web every corner of the planet.
MARKET MOVERS: FED MINUTES, IMF MEETING IN PERU, PMI INDEXES IN EUROPE
After the disappointing data on US employment, the markets intend to understand whether the American recovery is slowing down, with the consequence of postponing the rate hike: a hike in the meeting of 28 October seems highly unlikely, the catchphrase is therefore destined to last until December 16, the last meeting of the Fed of 2015. Meanwhile, Mario Draghi has cooled down the expectations of an imminent increase in European Qe, emphasizing that the eurozone economy is improving.
In this scenario, macro data usually have a significant weight: both the non-manufacturing index in the United States are out today. As well as European SMEs. Great attention also deserves the publication of the minutes of the September meeting of the Fed in which it was decided to postpone the increase in the cost of money. The heads of the Bank of Japan and the Bank of England are important, even if no changes are expected in the monetary policy of the two countries.
Even more relevant is the publication, tomorrow, of the Outlook of the Monetary Fund at the opening of the autumn meeting of the institution and the World Bank. Christine Lagarde's press conference will follow on Thursday. Two opportunities to raise the alarm about the slowdown in economies and the appeal to the US not to tighten monetary policy. The meetings will be held in Lima, a venue that was supposed to celebrate the strong recovery in South America. But, conversely, the Emerging Markets are the most exposed to the consequences of an increase in the dollar, driven by the rise in the cost of money.
Meanwhile, the week of Piazza Affari ended with a modest gain (+0,26%). The Italian Stock Exchange remains firmly in the lead in the ranking of performances since the beginning of 2015: +12,5%. The S&P 500 index closed in positive territory in New York +0,9%. Down Frankfurt (-1,40%) and Tokyo (-0,9%). Shanghai is missing, closed since Wednesday for holidays.
Bonds benefit from the turbulence in equity markets: demand has pushed the 0,5-year German Bund back below 5%, the 110-year is back in negative territory. Great solidity also for BTPs: the spread fell below 1,11 basis points, as in May before the Greek crisis. The dollar weakened at the end of the week from 1,13 to XNUMX against the euro.
ITALIAN POST
The go-ahead from the Commission is expected for next Thursday at the Poste Italiane landing place in Piazza Affari. From today there will also be an acceleration of the whirlwind of meetings between the Treasury and the company to define the quantity of securities to be put up for sale, the portion intended for institutional investors and that reserved for savers and, within the latter , the quota to be reserved for employees.
In recent days, the analysts of the banks in the placement consortium have advanced their assessments on the valuation of Poste Italiane, currently between 8 and almost 12 billion. 40 percent should go to the market. At the listing, Lazard and the Gianni Origoni Grippo firm act as advisors for the Treasury, Brancadoro-Mirabile and Clifford Chance for the company.
In the meantime, the takeover bid for Italy also starts online on Seat Pagine Gialle.
FCA
Every day is good for the presentation of the prospectus for the placement of 10% of Ferrari on Wall Street. In the meantime, Fiat Chrysler, also thanks to the good performance of September sales in Italy and the USA, has recovered part of the ground lost due to the Volkswagen crisis: +3,8% best blue chip of the week.
Sergio Marchionne's stated goal is to obtain a valuation for Ferrari of at least 10 billion dollars, a possible goal judging by the strong expectations both in the US and in Piazza Affari. In this way FCA would collect one billion dollars from the sale to which, at the end of the operation, the approximately two billion proceeds from the spin-off will be added. For now, 80% of Ferrari will continue to belong to the group while 10% will remain under the control by Piero Ferrari. In 2016 there will be a spin-off with Exor which will become the first shareholder with a 26% stake.
Meanwhile, the pressure from the US and European authorities continues on Volkswagen and the entire four-wheel sector. The American EPA took the opportunity to test 28 models of BMW, Chrysler, GM, Land Rover and Mercedes as part of the investigation into the anti-smog device, to see if there have been other manipulations on emissions.
Other clouds are gathering over the Wolfsburg house, including the investigation by the Italian Antitrust. On Friday, the Volkswagen stock (-3,71%) slipped to minis from 2011 to 101,90 euros. For Crédit Suisse, the cost of Dieselgate will fluctuate between 23 and 78 billion (base scenario, 43 billion) with an impact on profits of over 3 billion up to 2017.
MONDADORI- RCS, SEGRATE LAUNCHES THE FLAGSHIP OF BOOKS
After nine months of negotiations, the white smoke arrived on Sunday: Mondadori took over Rcs books for 135 million, winning a series of prestigious brands (Bompiani, among others, while Adelphi should withdraw from the group) and authors (although it is obvious the farewell of Umberto Eco). After the signing, however, it will be necessary to pass the scrutiny of the Antitrust which could impose some sales, given that the share of the Fininvest company will rise to 35-40% of the market.
The positive financial effects for Rcs were immediate, forced to sacrifice by the need to raise cash: the group was crushed by 526 million debts (as of 30 June) which must be reduced below the threshold of 440 million by the end of the year in order not to trigger covenants with the banks and make a new capital increase necessary, very unwelcome to the main shareholders, from the Agnelli family to Mediobanca, as well as the Rotelli heirs and Urbano Cairo.
The new center will count on a turnover of around 500 million on a market that, overall, is around 1,2 billion.
LUXURY
The new Yoox starts this morning, after the green light from Consob for the merger with Net à Porter. The share of Federico Marchetti's company has already celebrated in weeks with an increase of 3,2%, the second among the blue chips. From today, the Bologna-based company will increase its capital by a total amount of 655.995,97 nominal euros with the issue of a total of 65.599.597 shares, of which 20.693.964 ordinary shares and 44.905.633 shares without voting rights (B shares), to service the exchange ratio of one newly issued Yoox share for each share of Largenta Italia (wholly owned by Richemont).
Yoox's exploits did not extend to other securities in the sector: during the week Tod's lost 7,5%, Moncler 4,32%.
SAIPEM
The time is running out for the next capital increase of the group now controlled by Eni. The operation, for an amount of approximately 3 billion, initially provides for the sale of a stake between 15% and 23% from the six-legged dog (which will thus be able to deconsolidate the Saipem debt) to the Fondo Strategico Italiano controlled by the CDP. The Fund led by Maurizio Tamagnini will then be able to participate pro rata in the increase. In the end, Eni will still have a stake in Saipem, which could then be diluted in case it appreciates the recovery plan developed by CEO Stefano Cao. The premises are positive: it is not excluded that within the year the company will be able to collect compensation for the cancellation of the South Stream project.
Meanwhile, while indicting the company for violation of law 231, the Milan investigating judge acquitted Paolo Scaroni for the matter of bribes in Algeria linked to Saipem.
Evidence of recovery also for Tenaris (+2,76% during the week).
POPULAR BANKS
Two key appointments for the cooperative banking sector: on Thursday 7 the appeals presented against the reform will be discussed at the Tar: the one presented by Adusbef, Federconsumatori together with twelve other shareholders of Pop Milano and the one presented by associations of shareholders of Pop Sondrio , Pop Milano, Banco Popolare, Veneto Banca and Ubi, with the economist Marco Vitale as the first signatory, and a fourth presented by a group made up of individual shareholders. The sentence could have important repercussions on the Ubi assembly, convened three days later to deliberate the transformation of the institute into a joint stock company.
