US growth continues and the "confidence of economic players has improved". But it is not yet time to proceed with a new rate increase. This is the unanimous verdict of the Fed board at the end of the first meeting of 2017. The economy is improving, just as the labor market has improved (246 more new jobs against the 160 expected) and consumer confidence. But Janet Yellen reiterated that "the increases must be introduced gradually". An elegant way to signal that the Central Bank, before moving, wants to have more precise indications on the intentions of the White House, especially in fiscal matters. During his electoral campaign, Donald Trump predicted an increase in debt up to 7.200 billion dollars over the next ten years. But Janet Yellen, above all, does not want to preclude any move before the situation is clarified both internally and in commercial relations.
MUSTIER FIXES NEW TITLES A 38% DISCOUNT
The attention of Piazza Affari was concentrated until the evening on Unicredit, waiting for the conditions of the capital increase of 13 billion which will start on Monday 6 February. The operation provides for the issue of 1,6 billion new shares at a subscription price of 8,09 euro, offered as an option to shareholders in the ratio of 13 new ordinary shares for every 5 (ordinary or savings) held. The disbursement for the new shares, explains a note, implies a discount of 38% compared to the price net of the detachment of rights (TERP), calculated on the basis of the official closing price. Five years ago, the €7,5 billion capital increase was at a 43% discount. The option rights will be traded on the Stock Exchange from 6 to 17 February and will be exercisable from 6 to 23 (from 8 to 22 in Poland). The banks of the consortium will guarantee full underwriting of any unopted shares.
Before the Board meeting, the stock achieved a rise of 5,7%, canceling the losses of the beginning of the week. Also yesterday, the contract was finalized with the banks that form the consortium which guarantees the success of the operation. Unicredit's rise was transmitted yesterday to the rest of the sector (sector index +2,45%). Banco Bpm +1,1%, Ubi +1,9%. There is no news on the takeover attempt by Intesa (+1,3%) on Generali, down by 0,4%. Mediobanca gained 0,8%.
ASIA WEAK, FED NOT MOVE WALL STREET
Reflexive trend this morning on the Asian lists. Tokyo drops by 1,3%, Hong Kong -0,8%. Sidney is also weak. The Chinese Stock Exchanges are still on vacation. Apple's star (+6,1% to 130,31 dollars, after the excellent quarterly data) illuminated the US market. Without the Apple, the Wall Street session would have been opaque. The S&P 500 index (-0,04) closed the fourth consecutive session in the red. Dow Jones -0,1%. Only the Nasdaq rises thanks to the push of the iPhone company.
After the closure, Facebook's accounts were announced (+2,91%): the social network beat forecasts both for profits ($1,41 per share, +78,5% compared to a year ago) and for revenues (8,81 billion dollars against 8.51). The company's cash base totals $29,45 billion.
Brent oil finished up 2% at $56,8 before easing during the Asian session. Exxon also slows down after the quarterly (-1,1%). In Piazza Affari Eni fell by 0,5%.
FCA BRAKES IN THE USA BUT ACCELERATES IN ITALY
Sales data for January confirm the car slowdown on the US market. GM volumes fell by 3,8% (-1% on Wall Street) and by 0,7% for Ford (+0,6%). The abrupt American decline of Fiat Chrysler continues (+0,10% on the Stock Exchange), which for a few months in a row marks a double-digit decline in sales (-11%). But to console the company are the results on the Italian market. In January, the brands owned by the Fiat Chrysler Automobiles group recorded a result above the market trend with new car registrations growing by 12,3% to 50.200 units compared to January 2016. The market share thus improved, rising to 29,3 .0,6% with an increase of XNUMX points.
THE EUROPEAN ECONOMY IS PULLING, BAGS IN RECOVERY
Positive day for the European markets, driven by the good performance of economic data: the PMI manufacturing index of the Eurozone stood at 55,2 points, the highest for 69 months. In Milan, the Ftse Mib finished trading with +0,81%, at 18.740 points, rebounding after two sessions of declines. The other markets of the Old Continent are also growing: the Paris Stock Exchange is up by 0,8%, Frankfurt +1%. The Bank of England meeting is scheduled for today: no rate changes are expected.
The progress, which involved all sectors, was amplified by the good results of many companies, starting with Siemens, which rose by 5,2%. Today, among others, the accounts of Vodafone and Daimler are arriving.
ITALY AT RISK OF INFRINGEMENT, THE DEFAULT RISK RISES
The ever more concrete risk of the opening of an EU infringement procedure hangs over Italy. The letter sent yesterday evening by Minister Pier Carlo Padoan, according to Brussels, is too ambiguous on the timing of the measures ("measures to combat tax evasion and to reduce spending") that the government intends to take. The latest attempt to avoid rejection is entrusted to the forthcoming meeting in Malta between Jean Claude Juncker and Prime Minister Paolo Gentiloni.
Meanwhile, the cost of insuring the 5-year Italian sovereign debt default (credit default swap) reached 173 basis points yesterday, the highest since December 5, the day after the constitutional referendum that led to the resignation of Matteo Renzi.
BTPs SUFFER, FRENCH SECURITIES ALSO IN THE SIGHT
The government bond market is weak. The Italian 2,32-year rate rose to 2,28% from 2015% and is close to the maximum since the summer of 2,35, marked in recent days at 190%. The spread with the same maturity of the Bund, after the peak of 185 basis points marked on Monday, travels at XNUMX basis points.
In addition to BTPs, political risk also penalizes French government bonds in view of the presidential elections in April. The spread vis-à-vis Germany reached 66 basis points, its peak for three and a half years.
RAIN OF BUY FOR FERRAGAMO, LVMH SCARES SAFILO
In Piazza Affari the most positive note comes from luxury. Ferragamo shone, rising by 6,6% after announcing positive results for the fourth quarter of 2016 yesterday evening. Positive opinions from brokers rained down. Barclays raised its target price from €23,5 to €25 (equalweight), Mediobanca Securities from €26,5 to €27 (outperform), Banca Akros from €22,6 to €25 (neutral) and JP Morgan to €22,5 from 22 euros (neutral).
Among the other luxury stocks, Moncler advances (+1,1%): Equita and RBC strengthen their Buy recommendation. The first raises the target to 20,70 euros from 17,70 euros, the second reiterates that the goal is 20 euros. Safilo falls (-7,5%) after the official confirmation of the joint venture between Lvmh and Marcolin which will start in 2018. The joint venture 51% controlled by the French will focus on the development and production of Celine and Louis Vuitton eyewear. Luxottica was also down (-2%).
BACK TO RACE STM: +12% IN JANUARY
The run of StM has resumed (+3,4%), which gained 12% in January.
Prysmian (+2,5%) and Buzzi (+2,1%) also performed well among industrialists. Good increases for utilities: Terna +0,8%, Snam +0,6%, A2A +1,4%. Telecom Italia -0,31%: ICBPI confirmed the buy recommendation on the stock pending the 2016 results (BoD meeting is set for Friday).
