THEUS inflation slows down in March, but excluding food and energy it still doesn't seem tamed, while fears of a recession are growing. Thus the markets, after a momentary upswing, were slow in the morning in New York (Nasdaq -0,25%) and mixed at the end in Europe.
Business Square it was confirmed as one of the best thanks to the banks and appreciated by 0,38% to 27.629 basis points. They are also positive Madrid + 0,4% London + 0,47% Frankfurt +0,32% and Paris +0,09%, while they retreat Amsterdam -0,5% and Zurich -0,28%.
The dollar moved down against the main currencies and also lost ground against the euro, which changed around 1,097 after touching 1,1 for a few seconds.
The raw materials remain well bought: Brent +1,3% to 86,72 dollars a barrel; wtf +1,62%, 82,85 dollars a barrel. Spot gold floats above 2000 dollars an ounce.
US inflation is slowing down but it is not tamed
US consumer prices rose weakly in March on lower gasoline prices, but underlying inflationary pressures were still strong due to high rents: so the month-on-month increase was the lowest since two years, +0,1% (against expectations of +0,2% and +0,4% in February) and on an annual basis the growth was 5%. However, excluding the volatile components (energy and food), monthly growth was 0,4% (from 0,5% in February) and 5,6% on an annual basis, in line with expectations, but more than 5,5 .XNUMX% in February. The fear now is that the surge in oil prices, following the new cuts decided by OPEC+, will have a negative impact in the coming months.
In key Fed i rate futures Short-term interest rates now reflect a 60% chance of a quarter-percentage point rate hike in May, versus a 73% chance assumed before the data. T-Bonds show rising prices and falling yields.
While awaiting the imminent publication of the minutes of the last meeting of the US central bank, new confirmations of a trajectory without deviations arrive from the ECB, precisely because of the trend in core prices in the block. “We believe that core inflation provides a better signal than medium-term inflationary trends – argues ECB vice president Luis de Guindos – but we are not so optimistic about 'core' inflation”. For the falcon Robert Holzmann, Austrian governor, the ECB must therefore proceed with a new hike of 50 basis points in May.
Still on the subject of central banks, today the Bank of Canada instead, it decided to keep interest rates unchanged at 4,5% for the second consecutive time, as recent data convinced it that inflation and economic activity will slow down quickly in the coming months. According to the central institute, Canadian inflation will drop from 5,2% in February to 3% in mid-2023.
Piazza Affari rises pending appointments
Banks protagonist again a Business Squarei, with substantial increases starting from Unicredit + 2,65% Bper + 1,91% Monte Paschi Bank + 1,68% Understanding + 0,72%.
Asset management performed well: Banca Generali +0,57%, Finecobank +0,56%, Azimut +0,43%.
The Agnelli galaxy is also dusting today, starting from Iveco +1,94% and Cnh +1,27%. A boost came from Volvo's record quarterly results (+7,35% in Stockholm), which spread optimism across the sector at European level.
We are also waiting for the government appointments on public subsidiaries, many of which are in the red today, such as Poste -0,9%, Leonardo -0,66%, Eni -0,39%. It's still in the money instead Enel, +1,66%, on which Jp Morgan raised the target price to 7,8 euros from the previous 7,6%.
At the bottom of the list is Stm -1,65%.
Stable spread and rising rates
The expectation of an ECB still in the trenches against inflation weighs on eurozone government bonds, who see rates on the rise. The ten-year BTP rises to 4,13% and the Bund of the same duration to 2,32%, while the spread falls back to 181 basis points (-0,99%).
On the primary, the Ministry of the Economy this morning placed a total of 8,5 billion 1-year and 4-month BOTs: 6,5 billion euro of 12-month bonds, with yields at their lowest for two months and at 3,390% from 3,613% in mid-March. Also placed 2 billion Bots maturing July 14, 2023.
