The world is preparing for a quiet weekend of fear under the pressure of the shadows evoked by the Chinese coronavirus. Thus, the holiday of the Chinese Stock Exchanges takes on a surreal character, which, as planned, will remain closed from today to next Thursday for the opening celebrations of the Year of the Rat. The World Health Organization has warned that it is "too early" to speak of a global emergency, but the death toll has reached 25. Many ceremonies, including that of the Forbidden City in Beijing, have been suspended. The few price lists open in Asia are dishes. Hong Kong finishes a session shortened for the New Year holidays almost unchanged.
Japan's Nikkei 225 gains 0,13%. The markets of mainland China and South Korea are closed. The Asia Pacific index rises by 0,1%, Tokyo +0,05%. Australia advances (+0,3%).
Consumer prices in Japan increased by 0,8% in December compared to a year earlier: the data showed an acceleration from 0,5% in the previous month and is higher than expected by +0,7%.
S&P: THE EMERGENCY COULD COST BEIJING 1,2% OF GDP
The rapidity and energy of the response of the Chinese authorities is impressive, determined to demonstrate that, unlike what happened with Sars in 2003, Beijing is capable of responding to the emergency. There are now 26 million people who cannot leave the perimeter of their cities of residence. According to S&P, the economy risks a heavy stop: the collapse of consumption could reduce GDP growth by 1,2%, due to the lack of shopping and travel.
Heavy impact on oil. Both Brent (-0,4% to 62 dollars a barrel) and Wti (55,47) are down again this morning. During the week, the decline reached 5%.
In a climate of uncertainty, gold is back on its feet: +0,3%, to 1.563 dollars.
CLIMATE OF EXPECTATION IN THE USA: NETFLIX BOUNCES
Little movement at the end Wall Street, which recovered the losses of the session after the intervention of the Health Organization: Dow Jones -0,09%, S&P 500 +0,11%, Nasdaq +0,2%.
It shines on the Netflix list (+7,2%), which thus corrects the losses incurred after the quarterly.
THE COMMON CURRENCY FOR MINIMUMS
The European Central Bank left rates unchanged. The euro weakened against the dollar, with a cross of 1,104 (-0,4%) at its highest since mid-December, after the ECB meeting. The Bund slips to -0,31%.
Christine Lagarde, who wore an owl-shaped brooch (a symbol of wisdom to be contrasted with hawks and doves), reaffirmed her commitment to maintain interest rates at current levels and to purchase bonds at a monthly rate of 20 billion euros, up to when inflation in the euro area does not converge towards the target of "slightly under 2%". The note issued at the end of the meeting also states that "the Governing Council of the ECB has decided, as planned, to initiate a review of the monetary policy strategy", which will also include the environmental strategy, as the president underlined (“I have already given indications for our pension fund to invest one billion in green products”).
THE HAWKS AGAIN ON THE ATTACK ON RATES AND QE
President Christine Lagarde stressed that the strategic review of the ECB's monetary policy will also assess the possible side effects of low interest rates over which the hawks are looming: on March 24, at the request of 200 economists, the Constitutional Court Germany will have to pronounce again on the legitimacy of QE. Deutsche Bank CEO Christian Sewing, speaking at the Davos forum, meanwhile invited the ECB to use its forthcoming "strategic review" as an opportunity to put an end to a once-necessary benchmark policy but which now it's doing more harm than good. According to Sewing, far more people in Germany are losing money on negative rates than are making money.
Piazza Affari saved itself from sales and closed a volatile session with a draw (23.707 basis points) conditioned by the Chinese syndrome on the markets, from East to West.
The rest of Europe was in the red, also held back by Wall Street's out of tune opening. Frankfurt loses 0,92%; Paris -0,65%; Madrid -0,61%.
London -0,87%: The bill implementing Brexit has officially become law, ahead of Britain's exit from the European Union next week.
THE ITALIAN 1,25-YEAR DOWN TO XNUMX%
The BTP also benefited from the lower propensity for risk. Once the fear of an imminent government crisis subsided, the 1,25-year yield dropped to 160%, down five basis points from yesterday. The yield differential between the 165-year BTP and the Bund stood at XNUMX points from XNUMX at the end of yesterday's session.
On January 28, the Treasury will offer securities for a total of 3,25 billion euros between Ctz and Btpei. The interest in the bonds of the periphery of the Euro area prompted Greece to consider the possibility of issuing a new long-term government bond in the coming weeks. An Athens official told Reuters.
FLY STM (+7,3%) AFTER THE ACCOUNTS
In Piazza Affari Grande protagonist of the day was Stm (+7,3%), which has more than doubled its share price in the last twelve months. The Italian-French group closed 2019 with net revenues down by 1,1%, to 9,55 billion dollars (8,61 billion euros), but for the first quarter of the year the French manager expects to reach revenues of 2,36 billion dollars (2,13 billion euros), up 13,7% on the same period of 2019. Barclays raised its target from 30 to 32 euros, reinforcing the Overweight recommendation.
In the wake of the semiconductor giant, Eles (+3,5%) advances, a leader in the production of equipment for testing and controlling the reliability of semiconductors.
Leonardo +0,1%: Exane reiterated the Outperform recommendation, target from 13,50 to 15,60 euros.
GOOD UTILITIES, CITIGROUP PROMOTES FERRARI
Ferrari -1%. Citigroup strengthens the Buy by bringing the target price from 120 to 180 euros.
FCA -1% due to fears of duties on car imports in the USA. The Dutch Road Authority (RDW) has recalled some Jeep Grand Cherokee models in Europe for software updates.
The drop in yields pushes the utility sector to the highest levels since 2010: Hera +2,4%, Enel +1,2%, Snam +0,4% and Terna +1,2%.
Banks weak but above the lows of the session. The correction of Mps continues (-2,6%). The Bigs were also negative: Unicredit -1,2%, Intesa -0,7%, Banco Bpm -2,2%.
Luxury continues to suffer: Moncler -2,5%, Ferragamo -0,4%. Sales also at Autogrill (-3,7%).
THUD OF UNIEURO AFTER THE PLACEMENT
Unieuro -6,8%. Italian Electronics Holdings has completed the placement of Unieuro shares up to the entire stake of 17,6% through accelerated bookbuilding at 13,25 euro per share.
Consob has approved the offer document relating to the mandatory total takeover bid promoted by Gamma Bidco on Gamenet, which will run from 27 January to 14 February.
Matica (+3,35%) has signed a supply contract in the United States with the largest System Integrator in the digital identity market.
