The market climate darkens after the meeting Federal Reserve yesterday, which left rates unchanged and reduced forecasts on future cuts.
Wall Street uncertain trading today (DJ -0,5%, S&P 500 -0,02%, Nasdaq +0,23%), but the European stock markets are back in the deep red and they all close with large losses, a sign of continental fragility triggered by the earthquake of the European elections.
Business Square drops 2,18% and slips again below 34 thousand points, to 33.609 basis points, dragged by Iveco (-5,16%), Montepaschi (-3,9%), Azimuth (-3,55%).
Paris retreats by 1,99% e Frankfurt by 2,05%; the two main lists, the French Cac 40 and the German Dax do not even have a rising stock. Madrid down 1,59%, Amsterdam -0,77% London -0,61%.
Elections and tariffs scare Europe
Elections and duties they scare the Old ContinentIn fact, it is not just the orientation of the US central bank that weighs on sentiment, especially as Powell yesterday left the door open to a rethink on the basis of the data. Rather, they make themselves felt uncertainties related to political framework, after the success of the far right in the renewal of the EU parliament. I'll be there in a few weeks political elections at great risk for France and Great Britain, while Germany sees an undoubtedly weakened leader.
So, though the G7 in Puglia tries to send a message of solidity and cohesion (although the US elections in November are also looming), investors opt for immediate profit-taking. In Borgo Egnazia (which is not a pleasant village but a resort) the seven greats have achieved a agreement on the use of future interests of approximately $300 billion in frozen Russian assets to provide a $50 billion loan to Ukraine.
The auto sector also continues to decline, following Brussels' decision to make it soar duties on imports of electric vehicles from China.
Wall Street is holding up with the tech guys
Wall Street appears less concerned and after updating yesterday the highs of S&P500 and Nasdaq, continues to grind out gains today with super attractive stocks like Nvidia ed Apple and Broadcom is the best on the S&P 500, after a better-than-expected quarterly and the announcement of a 10-for-1 stock split, which will take effect on July 15. Shine Tesla, while Musk is on his way to getting his gargantuan $56 billion salary.
I macroeconomic data of today also offer new ideas to those who want to see the glass half full (not one but two interest rate cuts in 2024): May producer prices fell more than expected (-0,2% month, + 2,2% per year) and weekly requests for unemployment benefits rise above expectations (+13 thousand). And Reuters writes that traders “assess about a 65% chance of a quarter-point move in September and are more or less fully pricing in a move by the November meeting, which falls two days after the U.S. presidential election.”
Yesterday there Fed kept interest rates unchanged to 5,25%-5,50% and from the 'dot plot' graph on the bankers' forecasts it emerged that they estimate only one cut of 25 points during 2024, against the three expected in March. The chairman, Jerome Powell, maintained the possibility of further moves.
Dollar on the upswing
In the absence of certainties the dollar strengthens and the euro retreats by 0,4%, after yesterday's gains, for an exchange rate in the 1,076 area. The yen weakens, in view of the decisions of the Central Bank of Japan, which will end its meeting tomorrow.
I T Bond they don't seem to feel the blow inflicted by the central bank and currently see prices still tonic and rates falling slightly.
Gold and silver futures are down heavily, while oil futures are flat.
Growing spreads
Risk aversion primarily penalizes Italian government bonds and rewards German government bonds, so today spread widens to 145 basis points, even if the 4-year BTP rate manages to stay below the threshold of 3,92% (2,47%), while that of the Bund closes at XNUMX%.
The tensions can also be felt in the primary sector: yields in fact rose this morning in the Treasury auctions, which placed 9 billion in government bonds on the market: three-year duration, with a gross yield of 3,47%, up by 15 basis points; 7-year, 3,72% gross yield, up 20 basis points; 15-year, 4,27% gross yield, up 12 basis points; 30 years, yield at 4,39%.
Last but not least, the Bank of Italy ha confirmed the economic growth forecasts for 2024 (+0,6%) and revised downwards those for next year (+0,9% from +1%) and 2026 (+1,1% from +1,2%). Inflation is expected at 1,1% in 2024 (from 1,3% in April estimates) and at just over 1,5% on average in the following two years.
Piazza Affari, Hera and Telecom buck the trend
Let's start with the few good news: on the main list of Piazza Affari Telecom is appreciated today, +0,63%, after Moody's raised the rating to 'Ba3', with a positive outlook.
They also moved against the trend Hera + 0,74% Diasorin +0,2% and Amplifon + 0,06%.
The rest is a minefield: , utility, banks, oil, there is no sector that is saved.
I rebates they open with Iveco, Mps, Azimut and continue with Unicredit -3,47%, Mediobanca -3,49%, Saipem -3,42%, Popolare di Sondrio -3,27%, Intesa -3,27%, Nexi - 2,94%, Interpump -2,8%.
Back off Stellantis, -2,77%, on the day of the first investor day. The group reiterated its financial objectives for 2024 and indicated a dividend distribution policy for 2025 at the high end of the 25-30% range compared to 25% in recent years.
Outside the Ftse Mib it is negative Fincantieri -5,51%, after the announcement of the 1 to 10 stock split preparatory to the capital increase up to a maximum of 500 million euros.
