I rates? “They should not be” higher than the current level and “the next move will be a cut, probably this year”. the governor of the French central bank said so Francois Villeroy de Galhau speaking at the World economic forum. “But it is too early to declare the war on inflation won,” the banker immediately put the brakes on, “the work is not finished even if our tightening maneuver has been more successful than we had predicted a year ago here in Davos”. The cost of money, however, will remain higher than in the 2015-22 period when the ECB had to fight disinflation.
More or less what he also claimed from the Davos stage governor of the Fed which cooled expectations of a substantial rate cut during the year, also postponing the first cut from March to the summer. The Davos audience adapts. Just like bonds, falling after the surge at the beginning of the year.
Hong Kong -10% in January. Real estate in decline
The world slows down, as do energy bills or the speed limits imposed by the municipality of Bologna. The exception is China. At least in part. The GDP in the fourth quarter rose 5,2% year over year, from +4,9% in the third quarter. In 2023 the Chinese economy grew by 5,2%, as anticipated yesterday by Prime Minister Li Qiang during his speech at the World Economic Forum in Davos. But the data, drugged by public investments, only tells part of the reality.
Real estate, in fact, continues to alight. House prices recorded the most significant annual decline since 2015: -0,4%, after -0,2% in November, the sixth consecutive monthly decline and the largest since March, discounting the persistent weakness of demand despite Beijing's efforts to mitigate the impact of a prolonged housing crisis. Faced with these numbers, Beijing's accounting dam, now a hotbed of, gives way deflation. The index sinks Hong Kong, down by almost 10% since the beginning of the year, which this morning reaches its lowest level since November 2022. The MSCI Asia Pacific index loses 0,8%, the Seoul Kospi -2,2% and the CSI -1%. 300 on the Shanghai and Shenzhen lists.
It also misses out Tokyo after reaching a new 34-year high at the start, the Nikkei lost 0,4% and the Japanese currency devalued. Cross dollar yen +0,2% to 147,2, a level not seen since the end of last month. It even brakes Mumbai which cancels out the gains from the beginning of the year. According to Sunil Koul, equity strategist for Asia and the Pacific at Goldman Sachs, India's promising stock market could be taken by storm by foreign investors in the months following the vote to renew the federal parliament. Set for April/May. Global investors bought $21 billion of Indian stocks on a net basis in 2023, the pace slowing this month ahead of elections that make Prime Minister Narendra Modi's third term very likely.
The malaise on Asian stock markets falls on a market already weakened by bankers' statements on expectations about the departure and extent of the rate cut. Bonds and stocks weakened.
JP Morgan cuts Banco BPM
Le stock exchanges of Europe they should open lower. EuroStoxx50 Futures -1%.
Milan's FtseMib flat in yesterday's session. JP Morgan downgraded Banco BPM, Bank of Ireland and ABN to Underweight from Neutral.
Also in red Wall Street futures -0,5%. The exception is Nvidia which closed yesterday up +3% on a new historical record. A sign that Artificial Intelligence still attracts a lot of interest; The Dow Jones, down 0,6%, was penalized by Boeing's -8%.
Only tech runs: the giant Synopsys is born
Of note is Synopsys +4%. The company specializing in software programs for the semiconductor industry has acquired Ansys. The operation is worth 35 billion dollars. Prey is down 4%.
They go up again i bond yields. Ten-year Treasury Note at 4,05% yield, +5 basis points. Bund at 2,25%, +2 basis points. BTP at 3,82%.
The markets, without too many illusions, await the words of today Christine Lagarde guest in Davos.
Euro dollar down for the fifth consecutive session to 1,086.
It also brakes Petroleum, almost insensitive to the tensions in the Persian Gulf. Brent and WTI oil down 0,6%. Gold to $2.025 an ounce, down 0,2%. Bitcoin at 42.800 dollars, little changed.
Unicredit, board of directors on 4 February. Eni unties the Kashagan knot
Leonardo. Goldman Sachs raises the target price to 18 euros.
Enel successfully launched a 1,75 billion euro sustainability-linked bond in two tranches in the Eurobond market. The company could review its development strategies in Argentina, after the meeting between the CEO Flavio Cattaneo and the new president Javier Millei, MF reports.
Unicredit has postponed the date of the board of directors' meeting on the fourth quarter results to February 4th from February 1st, which will be presented to the market on February 5th.
Eni The private partners of the Kashagan field development consortium are close to settling their disputes with the Kazakh authorities, Bloomberg wrote yesterday. The agreement should include an increase in the investment program in social projects.
Tim The board of directors meets on Thursday to start work on the list for the renewal of the board to be submitted to the shareholders' meeting scheduled for April 23, with CEO Pietro Labriola aiming for reconfirmation. In detail, the board will have to formally approve the guidelines for compiling the list. In Thursday's meeting, the board of directors will also evaluate the reduction in the number of directors which, the sources explain, should fall to 9 from the current 15. With 24% of the capital Tim's ordinary, Vivendi represents the main unknown for the council list and for a second mandate in Labriola, at the helm of Tim since January 2022, when he took over from Luigi Gubitosi. Vivendi, which has no longer had direct representatives on the board of directors since the beginning of last year and has reclassified its stake in Tim as financial, does not intend to support Labriola's reappointment but is not currently working on its own list.
Intesa Sanpaolo is ready to face the rate cut, says CEO Carlo Messina in an interview. The bank plans to increase the contribution of commissions from managed savings.
Webuild should obtain some large orders in Saudi Arabia, overall we are talking about orders for a total of around five billion dollars.
