The European lists close up in the first session of the week, consolidate the positive sentiment of the last eighth and seem ready to end the month of May in progress. Meanwhile, yields on government bonds in the euro area are rising, after the impressive rise in inflation in Germany. It also strengthens the euro, at a five-week high against the dollar, in the 1,077 area and the price of oil increases, but the smoke from the EU remains black on the embargo on Russian crude oil.
European price lists on the rise with luxury and technology
Piazza Affari appreciates by 0,7% to 24.808 basis points, in line with Amsterdam +0,86%, Frankfurt +0,79%, Paris +0,72%. London was slightly moved, +0,22% and Madrid was flat, -0,06%.
Deprived of the compass of Wall Street closed for Memorial Day, the continental price lists today reached a three-week high relying on the good news from China, given the easing of the anti-Covid restrictions and the ad hoc measures for the economic recovery of the areas most affected by the pandemic. This helped luxury stocks in particular, which are eyeing a recovery in Chinese demand. Technologists are also doing well, after the jump in the Nasdaq seen last Friday.
The turbulence on the markets had already largely subsided last week following the reading of the minutes of the last meeting of the Fed, less aggressive than expected.
Germany, inflation at levels of the oil crisis
Whether the Fed could turn out to be more cautious than feared, the ECB may be forced to move faster due to an unbridled price race. In Germany, the preliminary estimate released by Destatis shows a monthly variation of 0,9% (May over April) and an acceleration to 7,9% per year. Expectations were +0,5% month and +7,5% year. At the origin there is the race in energy prices (+38,3% per year) and food prices (+11,1%), which has accelerated a lot with the war in Ukraine. Disruptions in supply chains caused by the Covid-19 pandemic have also contributed to the boost. To find a similar rate of inflation, reports the statistics office, we need to go back to the oil crisis of '73-'74.
The European Central Bank will have to take this into account, although it has already announced that it could start moving on rates in July. The chief economist of the ECB Philip Lane, in an interview with the Spanish newspaper Cinco Dias, does not consider a 50 basis point increase, but argues that the Eurotower will move with two adjustments of 25 points, one in July and one in September.
In this context, the yields of the block rise. The 10-year BTP briefly exceeds 3%, to close at +2,98%. The Bund with the same maturity marks +1,04%, for a slightly lower spread to 193 basis points (-0,4%).
Russian bonds, mechanism similar to oil
On the subject of Bonds, it should be noted that Moscow is studying a mechanism similar to that put in place for oil to regulate agreements with holders of Russian Eurobonds. Finance Minister Anton Siluanov, in an interview with the Vedomosti newspaper, explained that in order to receive coupon payments in its original currency, the investor will have to open accounts in foreign currency and in rubles at a Russian bank.
Oil on the rise but the EU cannot find an agreement
“We have worked hard on the sixth sanctions package, progress has been made and discussions are still ongoing, but we are not there yet: I have low expectations of a deal in the next 48 hours, but I think there's a chance after that." So the president of the European Commission Ursula von der Leyen before the start of the EU summit.
In any case, oil remains well bought, even in a context of increased demand and in view of the Chinese reopenings. Brent up 0,47% and trades at $120 a barrel.
Piazza Affari toned up with Interpump
Interpump took advantage of the positive day and appreciated by 4,47%, recording the highest increase of the day among the blue chips. Purchases also poured into Moncler +4,18% and others luxury titles such as Cucinelli +3,61%, Ferragamo +2,76%, Tod's +2,14%.
Attention was then focused on Telecom, +3,14%, after signing a non-binding memorandum of understanding with the CDP relating to the integration project between Tim and Open Fiber networks.
In asset management Poste Italiane shines +2,2%. Among the oil stocks, Saipem, +2,03%. Well the car: Stellantis +1,83%, expanded the partnership with Toyota Motor Europe with an agreement for the production of a new large commercial vehicle which will also be available in a battery-electric version.
The banks are confirmed to be well tuned. Goldman has launched coverage on Unicredit (+0,91%) and Intesa (+0.61%) with a "buy" on the benefits expected from the expected rate increase.
Among the financials Generali remains weak, -0,23%, after the resignation of Caltagirone from the Board. Unipol also decreased -0,83%.
Between the biggest drawdowns of the day many utilities appear: Hera -0,74%, Italgas -0,74%, Terna -0,5%, Snam -0,47%.
