“We are having very good talks.” Thus, without adding other comments, US Treasury Secretary Steven Mnuchin after the first contact with the leaders of Beijing, waiting to pay a visit to President Xi Jingping. The operators take note of this, without getting too many illusions: any agreement between the two giants on trade will be long and complicated. But it is already a long time that the thread of the negotiation is not interrupted. In the meantime, the markets are waiting for the data on US employment, the most important of the week to measure the state of the stars and stripes economy and the possible room for a new leap forward of the dollar. The euro, despite the drop in European inflation, is recovering ground against the dollar, after weeks of weakness: cross at 1,198.
ARGENTINA, NEW EMERGENCY: RATES RISE TO 33,25%
But the recent rally in the US currency and bonds (today 2,94-year bonds trade at 33,25%) has already claimed its first victims. Argentina had to raise its discount rate by three points to 3,3% for the second time in a week to try to shore up the peso. At this rate, the financial recovery of Buenos Aires risks having a short life. The Turkish lira (-4% in three days) is also under pressure like other emerging countries (the JP Morgan index lost 2018% in XNUMX).
In the meantime, the Stock Exchanges are heading into the weekend without major surprises. With the exception, perhaps, of Piazza Affari, now enlivened by the “mother of all assemblies”: the duel between Elliott and Vivendi at the Telecom shareholders' meeting.
ASIA LITTLE MOVED, WALL STREET RECOVERS IN THE FINAL
Hong Kong loses 0,3%, the CSI 300 index of the Shanghai and Shenzhen stock exchanges loses 0,2%. Seoul -0,7%. Mumbai -0,2%, Singapore -0,6%. Against the trend Taiwan: +0,4%. The Japan Stock Exchange is also closed today for the Golden Week holiday.
Wall Street was in the red, held back by a series of disappointing corporate results, even if almost all the losses were recovered in the end: the Dow Jones closed at 0,02% after falling by 1,5% during the session , S&P 500 -0,23%, Nasdaq -0,18%.
TESLA AND SPOTIFY UNDER FIRE
In steep descent Tesla (-5,6%), held back by the revolt of analysts against Elon Musk who during a turbulent conference call refused to answer "a series of really stupid questions".
The gold freshman Spotify also loses hits, -5,6% after the accounts, the first released after the listing.
Oil dropped slightly this morning: Brent at 73,6 dollars a barrel.
SAIPEM, THE FOREIGN FUNDS ARE RAINING
At Piazza Affari Eni and Tenaris -0,2%. Down on the day of the Saipem shareholders' meeting (-1,8%), brought to trial by a large group of shareholders, for false financial communications.
LOW INFLATION HOLDING BACK EU EXCHANGES. MILAN -0,8%
Closing down for the main markets of the Old Continent at the end of a day marked by the surprise drop in European inflation which fell last month to 1,2% on an annual basis from the previous 1,3%, a figure that could complicate the ECB's exit strategy from the current ultra-expansionary monetary policy. In the meantime, however, the gain of the euro against the dollar in the last few sessions accumulated in the first months of the year when the cross between the two currencies had reached a maximum of 1,256 has been eliminated.
Futures on European stock exchanges anticipate an upward start of about half a point.
VOLKSWAGEN DOES NOT EXCLUDE THE DUCATI SPIN-OFF
At the end of the day, the Ftse Mib lost 0,83% in share, thus moving away from the highs since October 2009 but remained above the 24 mark (24.064).
Frankfurt -0,57%. Volkswagen is considering possible spinoffs of non-core assets such as motorcycle maker Ducati and transmission maker Renk. The new CEO Herbert Diess announced it at the meeting.
The other markets were also negative: in Paris (-0,50%) bank stocks suffered: Bnp Paribas -1,46%, Credit Agricole -1,94%. Instead, Veolia Environment performed well (+2,41%). Madrid -0,47%.
The markets outside the eurozone are also in the red. London -0,8%. Bt Group dropped sharply -4.09% while the low cost EasyJet dropped 1,59%. Zurich -0,61%.
SLOW DOWN GROWTH. ITALY AT 1,2% IN 2019
Economic growth in the euro area will slow to 2,3% this year and 2% next year from a peak of 2,4% in 2017, the European Commission estimates in its spring forecast which stresses the need to accelerate reforms before the economy worsens. As regards Italy, the EU Commission confirmed the estimates for 2018 and 2019 but does not hide an increase in downside risks: GDP will rise by 1,5% this year "largely supported by domestic demand", while a slowdown to 1,2% is expected for the next one.
The yield of the 10-year BTP closed down, at 1,74%, like the other government bonds in the Eurozone. The spread with the Bund widened by 121.10 basis points, +1,85% thanks to a better performance of the German bond.
RECOVER THE BUND, THE SPREAD GOES UP
The Italian secondary is starting to close up a session characterized by a certain volatility, determined by the return of activity after the various holidays. The spread with Germany appears to be widening from the lows of the session on a better performance of the Bund: the yield on the ten-year German benchmark closed at 0,531% from 0,579% on Wednesday.
TELECOM, CDP'S VOTE IS DECISIVE
Almost flat in Piazza Affari Telecom Italia (-0,02%) on the eve of today's clash between the French shareholder Vivendi and the Elliott fund, the American giant which in recent months has been engaged in 15 corporate battles, 8 of which in Europe . A record turnout of 66-67% of the share capital is expected at today's meeting. At least according to the number of shares deposited so far.
The shareholder CDP, which entered with 4,2% and then rounded up the stake up to almost 5%, deposited the entire share. The eyes of the market are focused on the moves of the Cassa tomorrow in the meeting which, with its share, could represent the tip of the balance in the dispute between Elliott and Vivendi: it is probable that the Treasury company sides with Paul Singer (in any case much more soft on the subject of the control of the Net) against Vincent Bolloré.
MARCHIONNE: HYBRID FERRARI? IT CAN BE DONE SOON
Almost all in red, 35 out of 40, the blue chips of the Ftse Mib basket.
Even Ferrari (-0,1%) paid the price, albeit slightly, after making the announcement better results than expected. During the session, the title fell by almost three points. In the first quarter net revenues amounted to 831 million, with an increase of 10 million or 1,3% (+6,3% at constant exchange rates) compared to the previous year. “We would be able to incorporate the investments necessary to switch to hybrid into the prices,” Sergio Marchionne said in the conference call on the results. The Prancing Horse has announced that a Capital Market Day will be hosted in Maranello during the first half of September.
Fiat-Chrysler -2,3%. The company sold 46.176 cars in Italy last month, -2,2% year on year. The group's market share in Italy stands at 26,8% (27,4% in the first four months). Registrations of the Jeep brand jumped by 124,45% to 7.481 units, with a share that rose to 4,37% from 2,07% a year ago.
Brembo marks the pace (-0,85%) after the leap on the eve.
BANKS DOWNWARD, BERENBERG PROMOTES UNICREDIT
The decline in inflation removes the prospect of a steepening of interest rate curves in Europe. The banking sector pays the consequences: in Milan the basket ended trading down by 1,19%, the sector is worse at a continental level, -1,9%.
Unicredit left 1,78% on the ground in the end. Berenberg yesterday raised the target price to 19,0 euros from 18,50 euros, leaving the Buy judgment unchanged.
Ubi Banca does worse (-2,36%). Mediobanca (-1,72%) and Banco Bpm (-1,5%) are also bad. Intesa closes at -0,49%.
THE LION ACCOUNTS ARE GROWING STRONGLY
Piatta Generali on the day of the board meeting. The data for the quarter were communicated this morning before the opening of the Stock Exchange.
The first quarter closed with growing profits, further strengthened capital ratios, a markedly improving combined ratio. Net profit stood at 581 million euro, up 8,6%, above analysts' expectations, as did operating profit (1,253 billion +4,9%). “The first quarter results make us look optimistically to the rest of the year, which will see the successful completion of the strategic plan,” said CFO Luigi Lubelli in a note.
Bad day for Moncler (-4%), the worst stock in the main basket. Jefferies cut the recommendation. Prysmian also down (-1,2%): Mediobanca cut its target.
NOTORIOUS WILL PRODUCE LAMBORGHINI, FILM WITH BANDERAS
Salini's (-8,5%) was the worst title in Piazza Affari.
Notorious (+12%) will take care of the Italian part of the film "Lamborghini" with the participation of Antonio Baderas. Shooting will begin in 2018. The value of the contract is equal to 10,3 million Euros: approximately 70% of the consideration for the production activity will be collected by Notorious Pictures during 2018 and 2019.
