After the long charge, Taurus needs to catch his breath. In other words, metaphorically speaking, traders are trying to collect the profits of the rally triggered by the prospect of the imminent trade peace and the fall in interest rates. Thus stock lists in Asia slow down, but the downward correction of bonds and other safe haven assets continues almost everywhere, in the face of a greater propensity for risk.
SCHOLZ AT THE FT: COMPLETING THE BANKING UNION
But the news of the day concerns Europe. In an intervention in the Financial Times, German Finance Minister Olav Scholz opens up for the first time to the prospect of a common guarantee on bank deposits, the most important element needed to complete the Banking Union. “The need to complete the banking union – he writes – is undeniable. After years of discussions, the time has come to put an end” also because with Brexit Europe will lose its main financial center, the City of London, which will have to respond with greater integration into the European financial system. An epochal turning point, even if it is not clear whether and how Scholz's idea is shared by Angela Merkel and the rest of the government. But the novelty nonetheless signals that something (thanks to the difficulties of Deutsche Bank) is finally moving: better late than never.
Weak stocks this morning in Asia: Tokyo's Nikkei is up 0,1%, Hong Kong's Hang Seng is at parity, Shanghai and Shenzhen's CSI 300 loses 0,3%, Seoul's Kospi earn 0,2%.
The yield on the Japanese ten-year bond rose by six basis points to -0,08%, a level not seen for six months. The 1,85-year Treasury Note came in at 0,32% and the Bund at -XNUMX%.
Gold yesterday recorded one of the largest daily declines in recent weeks, -1,7% to $1.485 an ounce.
The dollar-yuan exchange rate fell for the seventh consecutive session, falling below the psychological threshold of 7.
DUTIES: TRUMP WANTS TO SIGN IN OHIO, XI RAISES THE PRICE
Last skirmishes between the Greats before the probable signing of trade agreements. Beijing is asking for the cancellation of the duties (125 billion dollars) imposed by Washington in early September. It is the price asked to comply with Donald Trump's request to sign the agreements in the USA, Ohio or Iowa. President Xi, aware of the electoral weight of the request, would have raised the price.
Wall Street watched the big maneuvers almost motionless: Dow Jones +0,11%, S&P 500 -0,12%. NASDAQ +0,02%.
UBER THUD ON WALL STREET, OIL HOLDS BACK
Note the leap of Adobe +4,25% after the brilliant results of the Photoshop producer. The crash of Uber (-9,85%) after the losses of the quarter was much heavier.
Brent oil at 62,7 dollars a barrel, down 0,5%, after three consecutive sessions of gains.
The euro gained 0,5% against the dollar, to 1,107. The pound moved little on the eve of communications from the central bank of Great Britain. Today Boris Johnson, after visiting Elizabeth II, should return to Downing Street and give the opening speech of the electoral campaign.
ARCELOR SHINES AFTER THE TEAR ON THE ILVA
The music has not changed yesterday in the Old Continent. The European stock exchanges advance, at a reduced but constant pace, for the fourth day in a row in anticipation of the longed-for peace on tariffs. There is no common thread to explain the rise except for the feeling that on the trade front, the worst seems to be behind us. But it is probable that today the lists will open under the banner of caution. Meanwhile the tear on the Ilva it did not damage Arcelor Mittal which, after the breakup, achieved a rise of 6% in two days (+2,2% yesterday).
LVMH BREAKS THE 200 BILLION EURO WALL
Piazza Affari closed up 0,23%, at 23.364 points.
In the third quarter, GDP increased by 0,1% on a quarterly basis, confirming the trend of the previous three quarters. The trend increase in the third quarter was +0,3% and the growth acquired for 2019 stood at +0,2%.
The best price list is that of Paris (+0,4%) in the wake of the LVMH march (+0,7%). The luxury giant yesterday celebrated the milestone of 200 billion euro in capitalisation, in second place in Europe behind Royal Dutch Shell (+0,85%).
Madrid (-0,14%) and Zurich (-0,57%) fell. London rises (+0,26%).
AN ECB-BASED BITCOIN? WHY NOT?
Even the European Union, like China, could consider the launch of a public digital currency, according to what was revealed by a draft of a document developed by the Finnish presidency seen by Reuters which invites the Eurozone, following the project of Facebook, much criticized by regulators, to introduce a private currency and to develop a common approach to cryptocurrencies, including the possible ban of projects deemed too risky.
BUND YIELDS GO UP. BTP OVER 1%
The race for safe-haven assets is interrupted, the spread is reduced below 131 points: The yield on the ten-year German Bund has risen to -0,31%, on levels last seen in July. At the end of October, however, the percentage of government bonds in the euro area with negative yields was down to 62% from 69% at the end of September. On a month-to-month basis, this is the first decline since April.
Bund yields were depressed by the similar drop in US Treasuries following the unexpected improvement in the US non-manufacturing ISM index. the yield on 1,87-year Treasuries rose to 20%, its highest since mid-September, and that on XNUMX-year German government bonds turned positive briefly for the first time since July.
The yield on the ten-year BTP rose again for the first time to more than 1% (1,017%).
UNDERSTANDING, USEFUL RECORDS. BANKS AT THE HIGHEST SINCE MAY
Yesterday the banks supported the rise: the FTSE index of Italian banks (+1,5%, 9.200 points) reached new highs since the beginning of May thanks to positive quarterly results of FinecoBank (+1,7%) on prices not seen since 2016 (71% in the last 12 months) and Intesa Sanpaolo +1,7% (net profit equal to 1,044 billion, Npe ratio at 7,6%, down 13% compared to the beginning of the year), published in the early afternoon.
Unicredit does even better (+1,65%). Monte Paschi (+4,4%) takes off on the eve of the accounts.
The sub-fund's gain since the beginning of the year widens to +21,0%, almost in line with the +22% recorded by the Eurostoxx50 index.
In the last month, a brilliant run-up by Italian banks to the most virtuous sectors has begun: the reference index has in fact gained 13,5% against the +6,5% accumulated by the Eurostoxx50.
AZIMUT SUPERSTAR, BUFFETT DEFENDS MINALI
Azimuth +3,45% after the release of quarterly data. The company closed the first nine months with a consolidated net profit of 247 million euros, +120% on an annual basis.
Among the insurance companies, Cattolica leaves 0,6% in the field: shareholder Warren Buffet says he is disappointed by the change in leadership last week. The oracle of Omaha talks about it in an email sent directly to the general manager Carlo Ferraresi, a manager to whom the ex-CEO of Cattolica Alberto Minali has been delegated.
SAIPEM LEADS THE ENERGY CHARGE
Another strong theme of the session, the oil companies.
Saipem (+3%) could soon conclude an important corporate reorganisation, with the spin-off of the drilling business. The list of potential partners could include Helmerich and Payne, Patterson-Uti and Pioneer Energy Services, all US companies in the drilling sector. Contacts would also be made with Transocean.
Eni+1,60%. Angola has formed a consortium of five international oil companies including ENI and Chevron to develop liquefied natural gas (LNG) for its soyo plant. The consortium's project will have an initial cost of $2 billion
Tenaris +1%. Goldman Sachs cut its target price to $20,6.
FCA, MOODY'S IMPROVE THE OUTLOOK
FCA still up (+0,6%): Moody's improved the outlook on the automotive group's rating to 'positive' from 'stable', confirming the Ba1 rating, following the announcement of the integration plan with Peugeot.
Ferrari (-2,7%) corrects after the rally following the accounts.
MOTORS IN DOUBLE FIGURES, PIAGGIO ACCELERATES
Sesa +0,5%. The investee owned by Tip has completed the acquisition of 100% of the capital of Pico, a company active in the offer of Digital Media software solutions, a historic partner of Adobe, with sales revenues at December 31, 2018 of approximately 20 million euros.
Piaggio +3,47% on the opening day of the motorcycle show. The two-wheeler market returned to double-digit growth in October, both in Italy and in Spain. In Italy, the growth of vehicles over 50 cubic meters was 11%, in Spain 12%. Piaggio president Roberto Colaninno said: “We have done much more than we thought: in terms of results, technology and products. We have done even more as a global presence, always starting from Pontedera and therefore from Italy”.
Of course now Germany is in agreement for EU funds for customers of failed banks……there is Deutsche bank which is about to blow up!!!!!