Fasten your seat belts: we go up. The minutes of the last Fed meeting show that the conditions have now accumulated for a first rate hike in 2018. And so, immediately after the publication of the minutes, the yield on the 10-year T-bond rose to 2,957% at maximum for four years. Thwarted Wall Street. The Dow Jones, which gained up to 303 points in the mid-session, closed by losing 166, or 0,67%. Also below the S&P 500 (-0,55%), Nasdaq +0,22%. The need for the US Treasury to refinance 28% of US debt during the year contributes to pushing for an increase in yields: about 3 trillion dollars in Treasury bills. “The expansionary measures taken by the administration – reads a note from M&G – will have to be covered by short-term issues, with further pressure on the level of yields”.
OIL DOWN. IN ASIA, ONLY CHINA IS GOING UP
Assuming a first hike in March, the markets are questioning the Fed's future moves. The minutes show that part of the board believes that two hikes in 2018 are sufficient, while others are asking for four. The markets will seek enlightenment in the words of the governors who will express themselves in these days (Kashkari, Quarles, Bostic, Kaplan today, followed by Dudley and Williams tomorrow) pending the first public intervention of the new president Jerome Powell, who will appear in the House next Wednesday .
Immediate repercussions on the markets. The dollar rose, traded this morning at 1,227 against the euro. Brent oil, penalized by the strength of the US currency, fell by 0,7% to 64,9 dollars a barrel. Weak oil companies in Milan: Tenaris -1,13% (today the board of directors on the accounts), Saipem -1,47%.
The stock exchanges of Asia limited themselves to reacting to the downward closure of Wall Street: Tokyo -1%, Hong Kong -1%, Seoul -0,8% and Mumbai -0,4%. The Chinese price lists are an exception, having returned to work after the week's holiday for the New Year. The Csi 300 index of the Shanghai and Shenzhen stock markets rose by 1,9%.
MILAN WEAK, GERMAN ECONOMY SLOWS DOWN
The data arriving in the afternoon from the American economy revived the European stock markets and partially compensated for the modest slowdown of the German locomotive and the upward pressure on rates. However, Milan closed a mixed session in pale red: Ftse Mib index -0,09% at 22.653 points after reaching a maximum of 22.698 points and a minimum of 22.445. Frankfurt did worse, with the Dax losing 0,14%, and Madrid (-0,81%). London (+0,48%) and Paris (+0,23%) collect moderate gains.
Among the macroeconomic data of the day, the PMI manufacturing indices in February do not give encouraging signals to the market. In Germany, the composite index stands at 57,4 points (from 59 in January), below the estimates of analysts who expected 58,5. As far as the European Zone is concerned, the manufacturing data fell to 58,5 points from 59,6 and disappointing expectations (which indicated 59,2). The Services Composite Index came in at 57,5 from 58,8 versus an estimate of 58,5. Finally, the index of managers in the services sector dropped from 58 to 56,7.
6 BILLION NEW BOTS COMING SOON
The BTPs are stable, with the 2,05-year yield at 132.10% and the spread with the Bund at 0,15 basis points, +3%, despite the approaching elections and forthcoming Treasury auctions. The offer between 4 and 2019 billion in total is expected on Friday, between the Ctz October 5 and two Btpei at 10 and 26 years. Next Monday, February 6, the Ministry of the Economy will make 6 billion euro of XNUMX-month BOTs available to investors, against maturing securities of the same amount.
Tomorrow the amounts and types of medium/long-term bonds offered on 27 February, in the last auction before the elections, will be communicated. Intesa Sanpaolo plans to launch a new 5-year Btp alongside the reopening of the 2028-year bond in February 2025 and the Ccteu 9, for a total amount of XNUMX billion.
The securities of the periphery hold up well. At the end, the Spain-Germany spread was trading at 80 points (against 81 on the eve), the gap between Portugal and the Bund was down sharply, down to 112 basis points (from 118). The Italy-Spain spread closes at 55, after a peak of 56.
PEACE SHADES VIVENDI-MEDIASET. TOMORROW BOD TELECOM
Day of grace for the luxury titles supported by the Milanese fashion shows. The most brilliant title was Salvatore Ferragamo +2,61%. Luxottica also performed well in the sector +1,35%, Moncler +0,07% and Ynap -0,05% set the pace.
Telecom Italia under voltage: +0,22% to 0,72 euro. For Mediobanca, the stock should be bought with a target of 1,30 euros. The average fundamental consensus target published by Bloomberg is set at 1,03 euros.
But the title faces many obstacles. The antitrust has expanded its investigation into possible anti-competitive conduct in the broadband market to the detriment of Open Fiber. Finally, tomorrow, the council dedicated to the sale of Persidera will be held.
Mediaset is down (-0,28%). The possibility of an agreement with Vivendi has failed. The parties will meet again in court next week.
CREVAL STILL IN DECLINE, TO HISTORIC LOWS
European banks and insurance companies have regained the plus sign, after a weak start, the Eurostoxx indexes for the category rise by around half a point (+0,19% for the Italian index) in the wake of the prospect of a higher cost of money in the coming months .
Among the banks, Unicredit closed in the red (-0,2%). Intesa Sanpaolo +0,2% Banco Bpm +1,55%, Ubi +0,68% and Bper +0,29%. In negative ground Mps (-2%). Eighth consecutive decrease for Credito Valtellinese, whose quotation is at new historic lows: the option right collapses by 35% to 1,73 euro.
Among other financials, UnipolSai closed down by 0,99% after the roadshow in London aimed at launching a Tier2 subordinated bond, the ten-year duration, the amount of €500m and the "bullet" structure were confirmed ”.
Azimuth also down (-0,3%). Akros confirmed the accumulated opinion with a target price of 22 euros, emphasizing that the appeal of the stock is given by the high yield for the proposed 2017 dividend of 2 euros.
ATLANTIA RELAUNCHES THE OFFER ON ABERTIS
Utilities are still weak, trailing today with -1% and trailing since the beginning of the year with a heavy (-9%). Bad Atlantia (-1,48%). The shareholders' meeting gave its green light to the extension of the deadline for the execution of the capital increase to service the Offer on Abertis from 30 April to 30 November 2018.
GOOD STM AND CAMPARI, RECORDATI BLACK JERSEY
Among the industrialists, the pink jersey goes to Stm (+1,62%) on the wave of Qualcomm's new offer for the Dutch Nxp. According to Equita Sim, this operation is conducted at values higher than those at which the Italian-French group trades.
At the bottom of the basket instead Recordati (-1,60%) still recovering from the lows of the morning (-4%). From the beginning of the year -20%, one of the worst performances of the FtseMib. Campari is still worth mentioning (+0,56%). Pending the February 27 accounts, it was judged by Berenberg as the best stock in the alcohol sector.
THE BLUE SKY FUND COURTS FILA
Row + 3,39%. Movements are in sight in the controlling structure headed by the Candela family. The Blue Skye fund has put on the table an offer of 150 million euros to get to hold 20% of the company's shares. A few days ago Exane announced that it had started coverage of the stock with an Outperform purchase judgment and a target price of 23 euros. According to French analysts, the stock trades at a discount compared to its competitors on the 2018-2019 Ev/Ebit multiple.
Banca Farmafactoring is bad, down by 4,3%, to 5,90 euros, after the placement of 10,1% of the capital by BFF lux at 5,75 euros.
