"We will use all our tools to support the economy, to have a strong labor market and to prevent high inflation from taking root." These are the words, already anticipated by the press office, which the Fed president will use today before Congress to convince the markets that the central bank is capable of keeping prices and the recovery under control.
But Jerome Powell's task, already difficult, appears difficult in the light of the news of the night: Richard Clarida, vice president of the Fed, has resigned, anticipating his exit by a few weeks. Clarida, the Fed's top official, confessed to shifting $5 million from a bond fund to a much more aggressive equity fund two days ahead of the Fed's emergency measures to prop up Wall Street in the face of the pandemic. And so, after Eric Rosengren and Lawrence Kaplan, the members of the Fed in the odor of inside trading rise to three.
COMPANIES GET SUPPLIED BEFORE THE SQUEEZE
It is in this far from edifying context that the Fed intends to launch a series of rate hikes and, no less important, cuts to the enormous balance sheet (9 trillion bonds) accumulated in recent years. The markets, aware that it will be a long and complex operation, are stocking up on liquidity in anticipation of the squeeze: companies have borrowed at least 100 billion dollars since the beginning of the year. Hence a possible explanation for the contrasting performance of the stock exchanges, especially the Nasdaq: first down then recovering (from -2,7% to +0,05%), the exact opposite of what happened in parallel for T-Bonds .
IN HONG KONG THE TECH
Asian markets are not participating in as much turmoil. Asia Pacific equities are mostly lower this morning, but the negative changes are small. The CSI 300 of the Shanghai and Shenzen lists loses 0,3%. The Japanese stock market, closed yesterday for holidays, lost 0,9% in the final session. Kospi of Seoul unchanged. Mumbai's BSE Sensex up slightly. Hong Kong's Hang Seng index gained 0,4%, from a 0,5% drop overnight. The Hang Seng Tech index, the basket containing the most important names in the Internet Economy, up by 0,5%, returns to the levels of a month ago. Tencent +1,8%. Meituan +1,5%.
TESLA GOES FROM -4,6% TO +3%, BITCOIN IS ALSO RISING
Wall Street futures are flat in the aftermath of a session of very strong excursions by the Nasdaq and the S&P itself, back from the lows but down by 0,1%. Dow Jones -0,45%. Tesla +3% in closing after losing up to 4,6% in start-up.
The bond market is no less dancing. Sales continued on two-year Treasury Notes, the most important for short-term rates, which achieved a yield of 0,90%. The 1,77-year trades at XNUMX%.
WTI oil was up 0,7% to $78,7 a barrel. Gold continues its ups and downs around the $1.800 level: this morning it's at $1.806, +0,3%.
Bitcoin recovered to $42.000, after falling below $40.000 for a few minutes.
US PRICES MAKE EUROPE SHAKE
The unmistakable shape of the Bear overlooks the edge of the wood of the markets. Piazza Affari, in line with the other markets of the Old Continent, adapts to the indications of Goldman Sachs, which foresees four rate increases during the year. But also to the message of Isabel Schnabel, an authoritative spokesperson for the Bundesbank's thinking in the ECB's board: the energy transition, says the banker, will undoubtedly lead to the need for higher rates in the near future.
BUT LANE (ECB) INSISTS: RATES WILL NOT GO UP
Meanwhile, Frankfurt continues to consider the current rise in inflation to be "transitional", as he reiterated in an interview with Sun 24 Hours the chief economist Philip Lane: it is highly unlikely, he said, that ECB rates will rise this year, because inflation will return below the 2% target in 2023 and 2024, unlike the US and the UK. The recovery is solid in Italy and in Europe, he added, recalling that the ECB is ready to intervene against the widening of spreads.
THE GERMAN XNUMX-YEAR YIELD APPROACHES THE YIELD ABOVE ZERO
The spread between the BTp and the Bund closed slightly in another session of strong sales on all bonds in the Eurozone, which, among other things, brought the yield of the German Bund a hair's breadth from returning to positive after more than two years and a half.
At the end of the day, the differential was 138 basis points, a fractional decrease compared to the 139 basis points recorded at last Friday's closing. The yield on the Italian ten-year bond is instead at 1,35%, from 1,32% on Friday.
But the two psychological thresholds under tension concern the 2-year US T Bonds, which move rapidly towards XNUMX% and, above all, the German stock, one step away from the zero threshold.
SPREAD TO 138, TREASURY AUCTIONS START TOMORROW
On January 12, the Treasury will auction 6,5 billion annual BOTs (against 7 billion maturing). On Thursday, in the medium and long-term auction, the Ministry of the Economy will propose the reopening of the three- and seven-year BTP benchmark.
Spain plans to issue 75 billion euros of government bonds during 2022, broadly in line with last year's total of 75,1 billion euros.
BUSINESS PLACE -0,96%, UNEMPLOYMENT AT 9,2%
Piazza Affari loses momentum: at the end of the session, the drop was 0,96%, the index dropped back to 27.353 points.
In November 2021, according to Istat, the Italian unemployment rate dropped to 9,2% (-0,2 points) and to 28% among young people (-0,2%). In the same month, employment grew by 0,3%, while the employment rate rose to 58,9%. In November, Istat explains, "the growth in employment observed in the previous two months continued, recording an increase of almost 200 employed in three months"; compared to January 2021, the increase is 700 employed and concerns both employee and self-employment. The employment rate is 2,1 percentage points higher.
AMSTERDAM BLACK JERSEY, CREDIT SUISSE IS LOOKING FOR PARTNERSHIP
Amsterdam, the market most sensitive to the technological sector, suffers the highest losses in Europe: -1,94%. Paris and Frankfurt are also in the red, losing 1,44% and 1,12% respectively. Madrid fell by half a point, while, outside the EU, London dropped by 0,53%.
Crédit Suisse (+1,27%) advances on the wave of rumors from a Zurich site on possible M&A transactions. Among others, the name of Unicredit has also been mentioned.
GOLDMAN LEAVES BMW. ATOS LANDSLIDE
BMW jumped 1,67% after Goldman Sachs promoted the stock to "buy" from "hold," saying consolidation of BMW's Brilliance Automotive joint venture will lead to higher earnings in 2022 and next year.
Athos -16,82%. The French digital advisory firm is the worst performer on the benchmark index, after issuing a profit warning reflecting delays in closing client deals and margin pressure at its hardware and software resale division.
BRUNELLO CUCINELLI ANNOUNCES RECORD ACCOUNTS
Book a sprint start on today's market Brunello Cucinelli, who approved the preliminary data yesterday of "a year to be framed among the beautiful ones": net revenues of 712,0 million euros, up by 30,9% at current exchange rates (+32,4% at constant exchange rates) compared to 2020 thanks to the expansion in Americas (+36,7%), in Asia (+32,9%), in Europe (+26,5%) and also in Italy (+23,2%).
BPER AWARDS CARIGE, TOWARDS THE THIRD POLO
Bper won the first and probably decisive sprint for the purchase of the controlling stake in Banca Carige. This is the result of the meeting of the Interbank Deposit Protection Fund, which yesterday examined the proposals received from Crédit Agricole, Cerberus and the bank of Reggio Emilia, which was granted an exclusivity period of four weeks to complete the due diligence and sign an agreement "as soon as possible" and in any case no later than 15 February. According to a press release from the Fitd, Bper's offer is "non-binding" and will be followed by a tender offer for 0,80 euro per share on the remaining shares of the Bank not held by the Fund, equal to 20% of the capital approx.
Bper +0,3%, together with Unipol (with a 19% stake), becomes the natural fulcrum of a possible third banking pole, which will probably also include Banca Popolare di Sondrio.
The banks are contrasted but above parity: Intesa Sanpaolo rises by 0,5%, Mediobanca flat, in the red Bpm (-0,3%).
LEONARDO RUNS ON THE WINGS OF TEMPEST
Leonardo (+1,86%) stands out on the main list. The Italian government has decided to put 2 billion euros on the plate for the Tempest programme, the new fighter-bomber launched in 2018 by Italy, the United Kingdom and Sweden. Pirelli was also positive (+1,46%).
IN STM AND FERRARI RED. VINEYARD PURCHASING CAMPAIGN
Stm fell sharply (-4,5%), leaving the gains on the eve of the day on the ground, matching the sales of the Nasdaq.
Bad day for the Agnelli galaxy: Exor -2,84%, Cnh Industrial -1,93%. Ferrari also retreats on the day in which Benedetto Vigna illustrates the reorganization of the Red Army: two managers from Stm join the team.
But the list of titles in red is long. Worst of all Nexi (-4,47%), on which Ubs has reduced the target price from 18,1 to 15,5 euros.
Also down Amplifon (-4,41%), Diasorin (-4,33%) and Interpump (-3,96%).
FERRAGAMO FALLS, MONCLER MISSES
Thump in Salvatore Ferragamo's fashion (-8,8%), penalized by the cut of the sell rating by Ubs. Down also Moncler (-1%), despite the buy of the Swiss broker.
UNIEURO LANDSLIDE, RECORD LEAP FOR ACROBATIC BUILDING
Thump of Unieuro, which closed the session down by 9%, at 19,22 euros: Kepler Cheuvreux who reduced the target price from 26,4 to 22,5 euros, confirming the hold recommendation. EdiliziAcrobatica is up (+3,5%) which closed 2021 with an increase in contracts of 186,7%, to 121 million euros, against 42,2 million the previous year. “The numbers clearly show how our business model is characterized by the ability to produce value in the territories in which it operates,” said CEO Riccardo Iovino.
