Very negative opening of the markets this morning. Tokyo at the end of the session it was deep in the red, -12,4%, losing more than a fifth of its value from last month's historic highs.
What favored the collapse was therate increase but it also weighed growth in US unemployment: in July only 114 thousand new jobs were created in the USA, a figure well below expectations, while the unemployment rate rose to 4,3%, the worst reading since October 2021. Data that dragged into the red the stock markets, fearful of a risk of recession.
Lo yen strengthens against dollar at 144,3, a value not seen for seven months. The yield rate on the 0,82-year government bond is at XNUMX%, ten basis points lower than last Friday and the lowest since April.
All Asian stock markets collapse: Taiex of Taipei -8,35%. Kospi of Seoul -8,78%. Very negative changes, but not so heavy for the index Sydney's S&P ASX200 (-3%,7).
Even the stock markets most exposed to the theme of high technology are plummeting: BSE sensex of Mumbai -2% at the start of the session. L'Hang Seng of Hong Kong, -3,09%. The less negative CSI300 of the Shanghai and Shenzhen price lists, -0,99%.
Stock market August 5: Europe also opens in the red
Le European stock markets open lower, EuroStoxx50 index futures -2%. Milan's FtseMib closed Friday down 2,6%, -5,3% for the week.
Italy is also slowing down. In June, Italian industrial production recorded a +0,5% compared to May, down by 2,6% compared to last year.
It rises like thiswaiting for the rate cut. The jump in unemployment to the highest since October 2021 triggered a new wave of selling in stocks on Friday. Nasdaq -2,4%, -3,3% for the week, the tech and innovation index lost more than 10% from the latest highs and has therefore entered the correction area. S&P500 -1,8%, -2,8% for the week. Russell 2000 index of mid&small caps -3,5%, -6,7% for the week.
August 5 stock market: two rotations coming soon
Hence the start of two rotations: the Great Rotation from stocks to bonds which adds to the Small Rotation that we have started to see on the stock market and which goes from the Magnificent Seven to the rest of the market. It is probable, according to experts, that in the coming weeks the burden of proving its stability will be placed more on equities than on bonds and more on high technology than on defensive ones. Geopolitical uncertainties also point in this direction.
USA, decisive week for Kamala Harris
Today one of the s beginsDecisive weeks of Kamala Harris' campaign for the US presidential elections. He should decide who his vice presidential candidate will be by Tuesday, he writes Ap. Yesterday Harris met with the main contenders for the role: Arizona Senator Mark Kelly, Minnesota Governor Tim Walz and Pennsylvania Governor Josh Shapiro.
With Trump we will have policies more favorable to stocks, with Harris to bonds. In fact, with Trump we will have deregulation, tax cuts for companies and tariffs that will favor domestic producers. Higher profits, therefore, but a Fed which, as we saw between 2016 and 2019, will be very reluctant to cut rates. With Harris, however, we will have higher taxes on businesses and finance (buy backs, capital gains) but also a Fed more willing to cut.
The specter of Iran hovers over the markets
Hovers over the markets risk in Iranian retaliation against Jerusalem. The market translates uncertainty into a greater propensity to buy Treasuries and into a certain prudence, particularly in Europe.
THEEurostoxx 50 index (4.765) closed down 2.4%, the lowest since February. The FtseMib (32.857 points) lost 2,80%, its worst session in a month and a half, under the weight of the fall of the banks. SocGen's alarm on the evolution of the interest margin caused some concern.
Tech sector in trouble
More warning signs. Berkshire Hathaway, Warren Buffett's investment company, surprisingly reduced its share by almost 50%. stake in Apple, +1,3%, which still remains the main company in the holding's portfolio. Total stock sales reached $75,5 billion, bringing liquidity to a record $276,9 billion.
Amazon -10% I revenues for the quarter rose by 10% to 148 billion, and profit more than doubled to 13,5 billion. “We continue to make progress on multiple fronts but none like the acceleration of growth of Amazon Web Service,” said the CEO Andy jassy. The company expects revenues of 154-168,5 billion for the current quarter and an operating profit of between 11,5 and 15 billion, below expectations.
Intel -28% announced a 10 billion cost cutting plan, 15% of employees will be cut, the dividend will not be paid.
stm -4,6%, falling to two-year lows following the terrible indications coming from Mobileye.
La Fed left interest rates unchanged, but opened up to the possibility of a cut in September. In the'Eurozone, inflation began to rise again in July, rising to 2,6% from 2,5% in the previous month. the weakening of the macroeconomic framework and, contrary to what happened in the past, the ordinary reading prevails: the bad news coming from the economy is also bad news for the stock markets.
Stock market August 5: the threat of taxes crushes the banks
Banks, insurance, energy and luxury are under fire. A tax on credit institutions would be triggered if tax revenues were limited, he wrote La Repubblica on Saturday, adding that the hole to be covered with a new solidarity contribution would be of about 4 billion. The new rumors follow the denial that came on Friday from executive sources. Palazzo Chigi is not studying a rule on extra profits. This was reported by government sources, defining as "unfounded" the press rumors regarding the hypothesis of a form of levy on credit institutions and insurance companies, and possibly also on other sectors such as energy and luxury.
A2A: if the exclusive negotiations with Ascopiave for the potential sale of a part of the gas network of the Lombard utility come to a positive conclusion, A2A is confident of obtaining from the transaction the resources necessary to cover the costs of the acquisition of some segments of the Enel electricity network. Milano Finanza writes that they recall that A2A has already issued a hybrid bond to finance the acquisition from Enel.
Intesa Sanpaolo Morgan Stanely raises the target price to 4,80 euros.
Prysmian: Barclays raises the target price to 67 euros, Morgan Stanley raises it to 71 dollars, from 69 dollars.
Tenaris: Morgan Stanley cuts AdR target price to $34.
Team: CEO Pietro Labriola said in an interview with Il Giornale on Sunday that the closing of the sale of Sparkle and the stake in Inwit should take place within the year and that "in the abstract" both Iliad and Poste Mobile are "possible options ” for consolidation.
Mondadori has signed put and call options on 10% of Adelphi with Josephine Calasso, holder of a total stake of 23,88%, exercisable from May 2027 at an exercise price that reflects an 'equity value' for 100% of Adelphi of 50 million euros.
