“In uncertainty, first I sell, then I think about it”. These are the words of a Wall Street trader on the news of the impeachment request made last night by Democrats against Donald Trump, accused of threatening the new Ukrainian president Zelensky to suspend military aid to the country if he did not order an investigation to frame the son of Joe Biden, Democratic candidate for the White House. The Chamber will now have to prepare the complex procedure envisaged by the Constitution.
No less dramatic was the situation in London after that the High Court has unanimously rejected the closure of Parliament wanted by Boris Johnson. It is probable that the premier, already beaten six times in a row in the Commons, will play the election card, now the only one to arrive at the Hard Brexit and in any case full of unknowns.
The financial markets take note of the double political earthquake and revise their forecasts. Until now, the most widespread thesis envisaged a phase of calm before the political duels in 2020, in view of the US elections. Times are now shortening, complicating the understood geopolitical agenda, starting with the negotiations on tariffs with China. The unknown factor is destined to weigh on the markets, which are increasingly committed to stocking up on liquidity.
CHINA SHOPPING MEAT IN USA
Asian stock markets are down. Down the Nikkei in Tokyo (-0,4%), yields the Hang Seng of Hong Kong (-0,9%) as the Kospi of Seoul (-0,7%). The Csi 300 of Shanghai and Shenzhen (-0,5%) were also down.
Trump took advantage of the stage of the UN General Assembly to attack China, unduly favored by being considered a "developing economy" by the WTO. But the resumption of negotiations between the Big Two is approaching and Beijing, to deal with the emergency of a swine epidemic, is about to conclude the purchase of about 100.000 tons of pork.
On the currency market, the dollar appreciated against the yen, at 107,3, the first increase after four days of decline. The Chinese yuan moved little.
The expectation of the impeachment request, announced after closed markets, has already weighed down Wall Street in the final: Dow Jones -0,53%, S&P 500 -0,84%. The Nasdaq -1,46%.
NIKE SALE (+5%) AFTER THE ACCOUNTS
In contrast, Nike (+5%) which announced growing profits in the quarter after the Stock Exchange.
Oil is down, held back by expectations of a reduction in consumption: the Wti falls to 56,86 dollars a barrel (-0,75%), the Brent to 62,55 (-0,86%).
On the currency market, the dollar appreciated against the yen, at 107,3, the first increase after four days of decline. The Chinese yuan moved little.
The euro lost 0,2% to 1,100, from +0,2% yesterday.
The pound traded this morning at 1,2473 against the dollar (+0,2%) slipped again, canceling yesterday's gains.
EUROPE WEAK, BUT BUSINESS AREA IS HOLDING
No news, good news. In the midst of so much turmoil, Piazza Affari enjoyed a colorless session on Tuesday, for once without political or financial turbulence, awaiting the launch of the maneuver at the end of the week. Quite different music in the UK. The London psychodrama, now in the midst of an institutional crisis, weighed on the Eurozone's price lists, especially those north of the Alps, the most affected both in the event of a hard Brexit and a surge in uncertainty. The better-than-expected data from the German business confidence index counts for little, however too weak to compensate for the winds of recession accentuated by the new accusations at Volkswagen's top management on the dieselgate.
Piazza Affari closed with imperceptible progress: +0,01% to 21.901,1 points.
Italy should close 2019 with a 2% deficit/GDP, according to the Deputy Minister of Economy, Antonio Misiani. The 7,6 billion maneuver launched by the previous Lega-M5s government to avoid the EU infringement procedure for excessive debt "brings the deficit back from 2,4% quantified by the 2019 DEF to 2% with which, in all probability, we will close the current year,” said the deputy minister in the Chamber.
Paris was also flat (-0,04%). Madrid does better (+0,28%).
VOLKSWAGEN SHOOTING RETURNS IN FRANKFURT
Frankfurt loses 0,26%. The index elaborated by the economic research institute IFO, relating to the business climate, rose slightly in September to 94,6 from 94,3 in August, in line with forecasts. But the index calculated on expectations falls to 90,8 from 91,3, worse than expected by the consensus (92). IFO based on current conditions, improves to 98,5 from 97,3. In the fourth quarter, according to the institute, Germany should be in stagnation.
The Braunschweig public prosecutor's office sued the management of Volkswagen -2,4% for "deliberately late informing" investors about the dieselgate risk. The current Herbert Diess, the former Martin Winterkorn and the chairman of the supervisory board Dieter Poetsch ended up in the crosshairs. Porsche was also affected (-2,7%).
London -0,56% after yet another resounding slap to Boris Johnson, this time by the High Court of Justice which unanimously rejected the suspension of parliamentary work imposed by Boris Johnson. The speaker of the Municipalities has reconvened the parliamentary work for today. But Johnson does not give up: the prime minister could decide to go to early elections even if, on this path, he will find the firm opposition of Labor but also of a substantial part of his own party.
In the midst of all the turmoil the euro pound exchange rate fell to 0,881 (-0,4%).
BTPEI AND CTZ AUCTION TODAY. FALLING RETURNS EXPECTED
The BTPs reduce losses in the final closing the session just beyond parity. The yield of the 10-year BTP is stable at +0,83%, but the differential with the Bund -0,59% yield (-1 basis points) has risen to 143 basis points (+1,16%).
End of month auctions begin today. We start with Btpei (500 million) and Ctz (1,5 billion) which yesterday was traded at a yield of -0,15% at the lowest levels since April 2008. The Treasury announced that on the 27th it will offer to auction up to 7,5 billion of the new 5-year Btp, 10-year Btp and Cct.
KEPLER CHARGES THE EENRGIA TITLES. FLY ACEA
Day of rotation between sectors in the Piazza Affari price list. Operators bet on utilities and sold banks.
The strong purchases on utilities coincided with the release of a report by Kepler Chevreux: "In a world of negative rates - we read - and a progressive decline in the cost of debt that goes to finance projects to increase investments towards the transition energy, regulated companies are experiencing a golden age”.
Among the nine securities analysed, Acea stands out (+6,93%), supported by the promotion to "Buy" by the broker with a target price of 19 euros. Strong progress also for Hera (+2,9%), Terna (+2,54%), Snam (+2,26%) and Italgas (+2,07%).
BANKS HOLD BACK, BUT MPS RISES
Negative banks in line with the European index. Down the big Unicredit (-0,82%) and Intesa Sanpaolo (-0,49%).
Monte Paschi is in positive territory (+0,39%). Equita judges the Hold title with a target of 1,6 euros. For the broker, the chances of integration with another institution "are extremely low". The possible candidates would be Ubi, down by 1,12% and Bper (-1,51%).
Weak Generali (-0,25%). Mediobanca rises by 0,14%.
FCA PAYS THE FINES IN THE EU AND THE TORPEDO IN THE USA
Difficult day for the Agnelli group. FCA fared (-2,043%) in the wake of the arrest of a top executive, Emanuele Palma, as part of the US Department of Justice investigation into diesel vehicle emissions.
CNH Industrial loses 1,28%. Banca Akros lowered the stock's recommendation to neutral from accumulated, bringing the target price to 11 from 10,5 euros.
The decline of more than 24% in Frankfurt by the manufacturer of heavy vehicle components SAF Holland after the cut of the 2019 forecasts also weighs.
Second consecutive decline for Juventus (-1,87%) after the announcement of the capital increase.
COOK'S BANKRUPTCY GIVES WINGS TO GREAT TRAVEL
Diasorin +2,3% after the announcement of the certification for sale in Europe of the new VZV Direct molecular test and the submission of the application to the US Food and Drug Administration.
Worth noting is the upward leap in Grande Voyages (+14,18%) following the bankruptcy of Thomas Cook: the market appreciates the failure of a competitor.
Giglio (+1,35%), a company that manages e-commerce for the excellence of Made in Italy in Fashion and Design, has decided to extend the services to Food as well.
