The financial week starts on positive ground. In Tokyo, the Nikkei index recorded a rise of around 2,50%, driven by the retreat of the yen against the dollar. Hong Kong also grew strongly +1,4%. Bull's propellant is the feeling that, at least for now, the Fed will not proceed with restrictive measures on the cost of money during the week.
In fact, all the spotlights are on Washington. Bernanke will speak at 14.30 (Italian time) on Wednesday 19 June, at the end of the two-day meeting of the FOMC, the monetary policy committee of the US central bank. After weeks of waiting, the market will have precise indications on the route that the US central bank intends to follow. The forecasts, based on the "moderate and modest" growth of US GDP, are for the confirmation that purchases linked to QE will slow down by the end of the summer (the announcement could arrive in mid-August in Jackson Hole, at the midsummer meeting ) of governors. But for now, as The Wall Street Journal's best-informed commentator pointed out, an increase in the discount rate is not on the agenda.
The latest data on the US economy have confirmed that growth is consolidating, but is not yet able to create as many jobs as the Fed president would like. And there is no trace of inflation. Friday's statistics showed zero growth in May for US industrial production, against expectations of +0,2%, and the drop in the consumer confidence index (University of Michigan) to 82,7, from 84,5 in previous month, which was the highest since July 2007.
Meanwhile, the Monetary Fund has lowered the US GDP growth forecast for 2014 to 2,7% from 3% and confirmed that of 2013 at +1,9%.
THREE THOUSAND BILLION DOLLARS WON'T BE RELEASED FROM MAY 21
Since last May 21, when Ben Bernanke hinted at the possibility of tapping (or phasing out) the Fed's purchases on the secondary market, the S&P index has lost 2,5%. But the losses on the financial markets (including bonds and sovereign bonds) were much more massive: 3,000 billion dollars in all.
The rate hike, according to Bloomberg, could be good for the stock exchanges. A statistic cited by Bloomberg notes that, judging by the price reaction in the last four occasions marked by a hike by the Fed, equity markets have rallied, offsetting the decline in bond markets. In particular, the S&P index grew by an average of 16% in the following two years.
The greatest tensions occurred on the foreign exchange market and on the T bond sector. During the week, the yen rose 3,3% against the dollar, to its highest since April 4th. The euro recovered 1% against the US currency.
The Btp-Bund differential settled at 276 bp at the end of the week. European stock markets closed the second consecutive week of declines. The overall index of the Stoxx 600 European Stock Exchanges (+0,2%) fell by 1,4% in the last five sessions. The previous week it had lost 1,8%.
Piazza Affari recorded an overall drop of 3,2% in the last five sessions, after having lost 3% in the previous week.
LUCCHINI AND SMEG HALVED IN VIA SOLFERINO
The Rcs capital increase starts this morning, on Friday -6,3%. The transaction will take place for a maximum of 421 million euro, with the issue of new ordinary shares at a price of 1,235 euro (1 euro for share capital and 0,235 euro for share premium), in the option ratio of 3 ordinary shares for each ordinary share already held , for a maximum value of approximately 400 million. The issue price of the ordinary shares was determined by applying a discount of approximately 30% on the theoretical price (terp) of the ordinary shares. The rights will be negotiated until June 28 and exercisable until July 5.
The increase will be covered by the guarantee syndicate for 380 million and seven shareholders of the agreement have signed the six-month lock-up: Fiat, Intesa, Mediobanca, Pirelli, Fonsai, Mittel and Edison. The Pesenti have also dissolved their reserves but will subscribe for 3,75%, just over half of the 7,4% held. Sinpar (Lucchini group) and Eridano (Bertazzoni) will also subscribe in half, reducing their respective shares to 1,25% and 0,75%.
The pact should continue to secure more than half of the share capital (54,5%), thanks to the greater weight of Fiat (2,8% more) and Banca Intesa (0,8% more). The unknown factor of Diego Della Valle (8,7%) and Giuseppe Rotelli (16,6%) still hangs in the shareholders' register.
GENERALI, MPS AND POP MI, THE CASES TO FOLLOW
Among the most current themes, the season of major sales in the insurance sector stands out. In Generali, -0,6% on Friday, the operation to reduce the perimeter wanted by Mario Greco continues. After the excellent Mexican deal, the sale of control of the Banca della Svizzera Italiana is once again topical. The novelty is the entry into the field of the Portuguese Banco de Espirito Santi, in competition with the Spanish Baniner.
On the Fondiaria-Sai front +3,2%, meanwhile, the rumor of Berkshire Hathaway's interest in Milan is losing its edge. Meanwhile Allianz does not seem interested in taking over the premiums (1,8 billion) that Unipol /Fonsai will have to sell at the request of the Antitrust.
The case of the week, in banking matters, concerns Monte Paschi di Siena in view of the assembly which will have to decide on the abolition of the 4% ceiling for members now envisaged with the exception of the Foundation. The new mayor of Siena gave a "yes but..." to the novelty (in any case imposed by compliance with the conditions requested by the EU) as long as "stable allies" are found. Standard & Poor's meanwhile first cut the rating to 'B' from 'BB' and then withdrew it at the bank's request. The downgrade of Mps also reflects the results of the 2012 financial year and the first quarter of 2013.
The best title on Friday was Banca Pop.Milano +4,6% on expectations of a change in governance. The other banks are contrasted: Intesa rose +0,9%, Unicredit -0,3% and Banco Popolare -2,1% fell. Autogrill's rally continued, +2,8%. Gtech gained 2,2% after Exane raised its target price.
