If Xi Jinping does not show up at the meeting scheduled on the sidelines of the G20 in Japan, Donald Trump will immediately trigger the new tariffs announced on 300 billion dollars of imports made in China. But the US president said he was sure of the participation of his Chinese colleague, defined as "a truly incredible guy, a great man, very strong and very intelligent". A completely different tone towards the Fed, which “continues to have an attitude that harms us. China - he added - has been devaluing for years, favoring its exports. We, because of the Fed, are forced to play uphill. But, despite everything, we are winning ”. The President's show framed the recovery of the Stock Exchanges, convinced that an agreement with China, if not peace at least a compromise, is at hand and that the Federal Reserve is now ready to play its part.
BEIJING STOPS THE FALL OF THE YUAN
The Csi 300 index of Shanghai and Shenzhen takes off (+2,3%). Followed by Hong Kong (+0,9%). Sidney also did well (+1,3%), the other Asian price lists were also positive.
Tokyo rises by 0,4%, the dollar-yen cross is at 108,6.
The Chinese renminbi appreciates to 6,92, after the central bank narrowed the daily fluctuation band and announced a bond placement, an operation that drains liquidity and strengthens the currency, which reached its lowest level since November on Friday.
OIL GIVES A BOOST TO THE RUBLE
Brent oil traded at $62,5 a barrel this morning, up 0,3% from -1,5% at yesterday's close. Saudi Arabia's leaders confirmed yesterday that they are moving towards an extension of the production agreement by OPEC enlarged to include Russia.
The ruble, closely linked to the price of oil, has been appreciating for a few days: this morning the dollar-ruble cross dropped to 64,9. The Central Bank of Russia is expected to announce a rate cut to 7,50% from 7,75% on Friday.
The oil companies did well yesterday in Piazza Affari: Tenaris (+3,5%) benefits from the agreement between the USA and Mexico, where they operate with various plants. Saipem +1,7%: Jefferies has raised its rating and target price to 4,65 from 4,4 euros to hold.
MERSERS PUSH WALL STREET
The US markets rose yesterday, also under the influence of a couple of mega mergers: Dow Jones +0,3, sixth consecutive day of rise, S&P 500 +0,47%. Nasdaq leap: +1,05%.
A new colossus is born halfway between defense and the space industry. The $121 billion merger between Raytheon (+0,7%) and United Technologies (-3,1%) was announced. Trump expressed concern about the effects on competition.
Salesforce, the cloud computing technology company, has entered into an agreement to purchase Tableau Software, for a total of $15,3 billion.
The 10-year Treasury Note weakened to 2,13%, from 2,08% on Friday.
This week there are also announcements from the Central Bank of Sweden and Turkey. The latter should confirm rates at 24%, a barrier against galloping inflation.
DOLLAR AND BANKS SUPPORT MILAN (+0,6%)
The good intonation of the dollar, galvanized by the agreement with Mexico, and of oil have given a hand to European lists, which have not celebrated Pentecost. The euro lost slightly against the US currency, retreating from the two and a half month highs reached last week and the exchange rate is moving around 1,131.
The Milan Stock Exchange, thanks to the push from the banks, started the week with an increase. The FtseMib index gains 0,61%, to 20.475 points.
Madrid leads the race by a whisker (+0,64%). London +0,6%. Paris is also advancing (+0,3%).
The markets of Germany, Austria, Switzerland, Norway, Hungary and Luxembourg remained closed.
EuroStoxx index +0,1%.
BITTER APRIL FOR ITALIAN INDUSTRY
The political crises begin to weigh heavily on the Italian economy and on that of Great Britain. In both countries hampers industrial production. In Italy there was a drop of 0,7% in April compared to March, the second consecutive drop. The consensus was expecting +0,1%.
Turbulent day on the political front: Giuseppe Conte renewed the threat of resignation and warned about the risks to which a procedure for excessive debt by the EU would expose Italian government bonds. For his part, the Northern League leader said he was confident in the possibility of mediation within the majority to then reach a compromise with Brussels. From the leader of the League comes an opening to shelve the idea of mini-Bots to pay the debts of the PA. "If there are equally effective and decisive tools, that's fine, the only factor on which one does not compromise is the unemployment rate," said Salvini.
THE BUND HOLDS BACK, THE 2018-YEAR LOW SINCE MAY XNUMX
Also thanks to the slowdown in the Bund, which has moved away from the all-time low of -0,21%, the spread fell to 259 at the end of a mixed session. Eventually the 2,36-year yield slid to 2018%, the lowest level since May XNUMX.
6,5 BILLION BTP AT AUCTION ON THURSDAY. THE CHALLENGE IS ABOUT 15 YEARS
The Ministry of the Economy will make available to investors between 5 and 6,5 billion euros of 3, 7 and 15-year BTPs at the mid-month medium and long-term auction on Thursday 13 June. In detail, the seventh tranche of the 3-year BTP in July 2022 will be offered for an amount between 2,25 and 2,75 billion, the fifth tranche of the 7-year July 2026 for 1,75-2,25 billion, while the amount offered for the fourth tranche of the BTP on 2035 March 1 is between 1,5 and XNUMX billion.
The market's response to the 15-year bond will be important: in the event of a decline, it would be the signal that investors are turning their backs on the Bel Paese.
UNICREDIT SUPERSTAR, MEDIASET FLY
Piazza Affari was driven by the awakening of the banks: Unicredit (+2,6%) leads the recovery of the sector (index +1,5%). In turn, the Eurostoxx index of the European banking sector gains 1,7%. Banco Bpm (+3,7%), Ubi Banca (+3%) and Intesa (+0,7%) advance. It was the drop in the spread that brought purchases back to the most "abused" sector since the beginning of the year.
Mediaset (+4,5%) passes with full marks examination of the presentation of Mfe, the Dutch newco into which Alfa Romeo and the Spanish subsidiary Mediaset Espana will be merged (-5,27% in Madrid). If Vivendi wanted to get in the way, it could exercise the right of withdrawal and ask for 2,77 euros for a share that paid 2016 euros in 3,7. The move would result in a loss of 320 million, but in doing so, in theory, Vivendi could cancel the operation.
FCA- RENAULT: MAYBE IT'S NOT OVER
Fiat Chrysler (+1,73%) in braking from the peaks reached in the morning after Reuters wrote that the president John Elkann and representatives of Renault have discussed the ability to restart the merger project. But, to complicate the picture, there is the growing distance between Renault and the Japanese Nissan. President Saikawa defined the French decision not to vote in favor of the new governance of the Japanese company as "very serious".
The rest of the automotive sector is doing well after the peace between Trump and Mexico. Brembo +0,8%. Pirelli +0,7%.
The lower tensions on tariffs push Buzzi upwards (+2,38%).
NEXI TOWARDS THE MAIN BASKET
Datalogic leaps out of the main basket (+6%).
Nexi unchanged, after reaching a new all-time high in view of entry into the FtseMib, scheduled for Monday 24 June. Tod's +0,6%: the increase in voting rights for 20,3 million ordinary shares of the group owned by the Della Valle family took effect, which correspond to 30,7% of the share capital.
