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Stock market 10 July: slight rise expected. France under the spotlight, Moody's warning on the new government. Tesla, Intel and Nvidia stand out on Wall Street

France remains at the center of investors' concerns in the Old Continent. Moody's warning on debt-related prospects and the repeal of the pension reform. What to follow in Piazza Affari

Stock market 10 July: slight rise expected. France under the spotlight, Moody's warning on the new government. Tesla, Intel and Nvidia stand out on Wall Street

European stock markets will move cautiously today too, with futures indicating a very slightly rising opening. Investors are awaiting clarification from France, also under the lens ofMoody's agency. On Wall Street good performances on Intel, Nvidia and Tesla. In Asia, good rise in Tokyo. Inflation almost flat in China. To Piazza Affari to follow Tim and Unicredit in addition to the banking risk. Flurry of ratings

Lo French political stalemate but above all the prospect that a new government will not be able to meet its fiscal and economic commitments has also begun to worry the rating agency Moody's. Yesterday he issued a warning saying that the possible repeal of the pension reform and the reduction of the government's commitment to reduce public spending could have a negative impact on France's rating which could be downgraded to "negative". Without a clear majority, “the approval of laws will certainly be difficult” observes the rating agency. Moody's expressed particular concern about the possible increase in interest costs for the debt. French President Emmanuel Macron's former prime minister, Edouard Philippe, called on center and center-right parties to join forces to form a new government.

The long-awaited speech by the Fed president yesterday to the US Senate, which will be repeated today in the House, did not cause any major surprises on the market. Powell yesterday he limited himself to repeating what was said in previous publications: that inflation is cooling but other signals and confirmations of the trend are needed before proceeding with the rate cut. GDP growth slowed in the first half of the year and the labor market is strong, but not overly so, he said, stressing that restrictive monetary policy is helping to balance supply and demand. “Cut too early and too much could damage progress made on inflation, while cutting too little too late could weaken the economy,” Powell added. Investors are looking for new clues about monetary policy. The prevailing bets are for a first easing in September.

The Dow Jones closed down 0,13% to 39.292 points, while the S&P500 gained 0,07% to 5.577 points, with a new all-time high of 5.591 points. Plus sign also for the Nasdaq (+0,14% to 18.429 points, below the new historic high of 18.512 points). The positive trend continued Intel (+1,77% to 34,59 dollars), after the strong rise achieved in the previous session. Tesla +1,18%. In the previous nine sessions, all of which closed on the rise, the stock gained 39%, +80% from the medium-term lows reached at the end of April. Barron's points out that at these prices, the stock trades at 88 times this year's expected earnings, while at the end of April, at the lowest price level, the P/E was 50. It had been over two years since Tesla reached deal at such high multiples. Nvidia +2,24%, Arm Holding Citi looks at the historical series and warns that the time may have come to start lightening positions on artificial intelligence stocks. While there are no signs of a price bubble, the rally in some names is “concerning,” strategist Drew Pettit said in a note. “We continue to suggest investors take profits on AI companies,” especially chipmakers. The Treasury Notes ten-year bonds at 4,29%, from 4,28% the day before, in the absence of any news from monetary policy:

Inflation almost flat in China. Bank New Zealand more accommodating

The Hang Seng of Hong Kong gains 0,3%, supported by Baidu (+13%) which benefited from the growing popularity of its Apollo Go robotaxis in China. CSI 300 of the price lists of Shanghai and Shenzhen on equality. In China Inflation recorded another very modest increase in June, remaining near zero for the fifth month. The index of consumer prices rose 0,2% from a year earlier, the Office for National Statistics said on Wednesday. Prices of entertainment-related consumer goods, household appliances and cars were hit last month as companies launched promotions for the annual "618" shopping holiday, the statistics office said. THE producer prices they stayed in deflation, as from the end of 2022, last month's decline is 0,8% compared to the previous year, in line with the result expected by economists. Domestic demand remains weak,” explains Zhiwei Zhang, chief economist at Pinpoint Asset Management. In the long run, China will need a recovery in domestic demand to drive the economy."

The Nikkei index of Tokyo closes higher, after a hesitant start to the session. The Nikkei index gained 0,6% to 41831,99 points, reaching a new record. They accelerate i producer prices in Japan in June 2024. According to the Bank of Japan, factory prices recorded an increase of 2,9% on an annual basis, in line with expectations, against the revised +2,6% of the previous month (from +2,4 .0,2% preliminary). On a monthly basis, industrial prices rose by 0,7%, less than the +0,4% of the previous month and against the +0,3% expected. Import prices fell by 0,3% on a monthly basis and increased by 2,7% on a year-on-year basis. Export prices were unchanged on a monthly basis and XNUMX% on an annual basis.

KOSPI by Alone unchanged. The BSE Sensex index fell Mumbai, -1%.

La Central Bank of New Zealand kept interest rates steady at 5,5%. The decision was in line with economists' expectations, but the considerations that emerged at the end of the Board meeting appeared more accommodating than expected. The New Zealand central bank, in fact, has raised the possibility of adopting one less restrictive monetary policy, should inflation slow as expected.

Stock market July 10: what to follow

European stock exchanges expected in fractional increase at the start of the session (+0,26% the Eurostoxx50 index). Yesterday the Ftse Mib of Milan closed yesterday down by 0,5%. The yield of the German Bund is at 2,57% from 2,53% the day before and that of the BTP at 3,95%. The Italy-Germany spread is at 139 basis points. The 3,11-year French OAT yields 56% and the Bund/OAT differential is at 1,082 basis points. The euro-dollar exchange rate at 81. Oil drops for the fourth consecutive session. WTI at $84,5 a barrel. Brent at 2.367 dollars. Gold at $58.000 an ounce. Bitcoin at $10.00. Data expected today at 0,1 on industrial production in Italy, after France and Germany showed a sharp decline. Expectations for the monthly data are +1% (previously -2,9%), previous year. -XNUMX%.

Team. The S&P Global agency has improved Telecom Italia TIM's long-term debt rating by two levels, bringing it from "B+" to "BB". The rating outlook for the coming quarters is stable. Tim's CEO, Pietro Labriola, in a meeting with employees, said that reducing debt "from over 20 billion to a target of 7,5 billion at the end of the year means having the ability to invest for growth". “Today we no longer have to go to the market to refinance ourselves, but we can concentrate on working to improve the results of our company and our leadership” he explained, recalling that “all the things we have said in recent years are coming true”. In an interview with Radiocor, Massimiliano Capitanio, Agcom commissioner, outlined the effects of the sale of Tim's network on regulation and hypothesized a regulatory easing.

Unicredit. According to the consensus of investment banks, the institute led by Andrea Orcel should have closed on 2 2024 quarter with a net profit of 2,19 billion euros (average value); the estimate is compared with the underlying net result of 2,12 billion euros recorded in the same period of the previous financial year. As for instead the whole of 2024, analysts expect a net accounting profit of 9,07 billion euros (average value), a forecast that compares with the previous indication of a final result of 9,01 billion euros communicated after the release of the financial results of the 1st quarter 2024. The earnings per share are indicated at 5,51 euros (minimum of 5,26 euros, maximum of 5,85 euros), compared to the 5,43 euros of the previous consensus.

To follow Unipol, MPS and Banca Popolare di Sondrio given that, according to the Messenger, Unipol it would be in action with the help of investment banks to indirectly strengthen its position in Sondrio (perhaps through Barclays) and in MPS through derivative contracts of almost 5%. The newspaper reports Unipol's denial regarding involvement in the Valtellina bank, of which it already owns almost 20%.

BancoBpm has placed an additional tier 1 bond with perpetual duration and callable starting from January 2031, for an amount of 400 million euros. The security received orders for over 2,8 billion euros, allowing the coupon to be set at 7,25% until 16 July 2031; if the issuer decides not to exercise the early repayment option, the coupon will be redetermined on the basis of the 5-year euro swap rate at the time of the recalculation date, increased by a spread equal to 455,3 basis points and will remain fixed for the next 5 years.

Mps Bank has placed an issue of social conditional pass through (CPT) European covered bonds with a maturity of six years (16 July 2030) and intended for institutional investors. The security was placed for an amount of 750 million euros. The placement received orders for over 1,2 billion euros, allowing the coupon to be set at 3,375% and a reoffer price of 99,445%, corresponding to a spread of 65 basis points on the 6-year mid swap rate.

Leonardo, in partnership with the American Bell, would be among the favorites in the race for the NATO super helicopter as part of the NGRC (Next generation rotor capability) tender launched in early February. The decision of the NATO support and procurement agency (Nspa) is expected on July 15th, which should choose three proposals for the development of a study contract

Fincantieri. The period dedicated to the capital increase closes today.

Flurry of ratings. Generali. JP Morgan revises the target price downwards to 26 euros. Eni. HSBC slightly adjusts the target price to 15,5 euros. Prysmian. JP Morgan restarts coverage with Outperform rating and target price at 71 euros. Saipem. Barclays raises the target price to 3,2 euros. Maire Tecnimont Barclays cuts rating to Equal Weight.

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