Only the missiles of the Houti guerrillas that threaten the Red Sea route, by convincing the giant Maerks to divert oil tankers around Africa, they risk ruining the Christmas atmosphere which reigns over the financial markets, in the belief that the start of a rate cut (at least a quarter of a point) is now imminent. The choices of Bank of America go in this direction, advising the customer to return to business actions after earnings on bond dropped to their lowest levels since 2009. Even the calls for caution from Thomas Barkin, Richmond Fed, and Rafael Bostic, Atlanta are increasingly less pressing. In this context, moreover, some apparently insoluble issues promise to be resolved, starting from stability pact reached in the evening.
But the headline, as always, belongs to Wall Street: Last night saw yet another record for the Dow Jones +0,7%. The S&P500, +0,6%, has further closed the distance from the maximum in its history, another 0,6% is missing and then let's prepare for a new toast. All eleven sector indices rose, 400 out of 500 stocks closed higher. Nasdaq +0,7%. The Russell 2000 index of mid-small caps rose by 1,9%, thus revisiting the highest levels since August 2022.
Tokyo does not raise rates, Alibaba also rises
The other positive note comes from Japan. The central bank has for now given up on raising rates. The Tokyo stock market is set to close up 1,5% with the Nikkei index one step away from its very long-term highs. The yen rebounds to 143,5 after three sessions of decline. From data on the trade balance released tonight, it emerges that exports recorded a decline of 0,2% year on year last month, from +1,6% in October: the consensus was +1,4%.
Hong Kong's Hang Seng index gains 1%. Inside, Alibaba rose by 1,7% on the day of the announcement of a reorganization of top management figures. The CSI 0,5 index of the Shanghai and Shenzen stock exchanges fell by 300%. Kospi of Seoul +1,7%.
Wall Street heads towards new records after ten rises
In the wake of this news, US futures are signaling an upward start: it would be the ninth consecutive rise. The FANG Plus index (+0,5%, 8.8773), which brings together the ten excellences of the American tech world, also marked a new all-time high. The rally of the last two weeks was driven by the massive repositioning of large and small investors, who had remained very skeptical about the prospects of the economy and rates. One of the big brokers, Goldman Sachs, now sees the S&P500 at 5.100 points in 2024, but in June it had suggested taking profits, citing high risks of a recession in the next 12 months, with targets of 3.400 points for the S&P500 if this prospect were strengthened.
Spain is included in the telephone capital
European stock markets should also open higher. EuroStoxx50 Futures +0,2%. The Ftse Mib index in Milan ended the session with a gain of 0,4% with reduced trading. Other signs of recovery on the telecommunications front. There Spain decided to enter the capital of Telefonica with a 10% stake after the news of the Saudi raid on the company.
Adjustment day for the American bonds and super day for European bonds. The yield on the 3,90-year Treasury Note remained almost unchanged at 2,02%, while that of the 2,11-year Bund fell to 3,62% from 3,75% and that of the XNUMX-year BTP fell to XNUMX% from XNUMX. XNUMX%.
In the meantime, wisely, other calls for caution are coming from ECB. “In my opinion, it is too early to declare victory over inflation and therefore not the time to cut interest rates.” As Martins Kazakhs, member of the Governing Council of the ECB. “Inflation has not yet reached the target and the process of reducing the inflation rate is unlikely to be smooth and flat,” says Kazaks, highlighting that while overall inflation has slowed more than expected, the core which excludes volatile components remained high in November. So if this remains the case, "overall consumer price inflation will rise again", notes the ECB member.
UK inflation drops
In the United Kingdom, inflation stood at 3,9% in November, down from 4,6% in October, lower than consensus expectations (4,3%). The core data was also well below expectations.
Brent (79,20 USD), WTI (74,0 USD). The Petroleum consolidates yesterday's +1,6%, while investors keep an eye on the situation in Red Sea after recent attacks by Yemeni Houthi militants allied with Iran. Washington has launched a task force to safeguard trade in the Red Sea after attacks by Yemeni militants forced major shipping companies to change routes, fueling fears of prolonged disruptions to global trade.
Il dollar consolidates the losses of recent weeks while awaiting concrete news on the macro front. The first serious appointment is for Friday when the PCE deflator, a fact that the Fed carefully evaluates when making its monetary policy decisions. The estimates are for a slowdown in the raw data (to +2,8% from +3,0%) and the "core" data (+3,3% from 3,5%). Meanwhile, data on the real estate market published yesterday confirmed an excellent state of health.
Asian Currencies. The latest moves by the FED have caused some shocks in the segment. The Yuan China remains behind while the People's Bank of China left the reference lending rate unchanged at historic lows. The Japanese Yen remained flat after falling sharply from nearly four-month highs in the previous session. The yen's weakness came as the Bank of Japan maintained its ultra-conciliatory stance at its final meeting of the year and signaled little intention to immediately begin tightening policy in 2024.
Tim, today the board of directors of F2i. Stellantis negotiates with the government
TIM. The F2i Board of Directors will meet today to give the OK to the establishment of the vehicle which will invest around 1 billion euros in Telecom Italia's fixed network, as part of the operation which will bring the asset under the control of KKR. A source familiar with the situation told Reuters.
stellantis saw registrations drop by 2,8% in November with a market share going to 14,9% from 17,4% in October, according to Acea data. In the EU and EFTA countries and in Great Britain, registrations increased by 6% compared to November 2022. The government is aiming for a agreement with the car manufacturer to increase national production of cars and light commercial vehicles to 1 million by 2028. Industry Minister Adolfo Urso said this in an interview with Il Sole 24 Ore. The minister also said he wants to attract other car manufacturers to Italy to produce a further 300.000-400.000 units per year and that the government is preparing to introduce incentives for the purchase of new cars in January.
