“I think we have a healthy economy today: the unemployment rate at 4,5% is slightly lower than what many Fed colleagues consider the level of full employment. Inflation is reasonably close to 2%, our target." Faced with this situation, added Janet Yellen speaking at the University of Michigan, the Fed must smoothly accompany the rise in the cost of money, preventing the engine of the economy from overheating”.
“If before we had to proceed at full throttle to rev the engine – he added – now we have to keep our foot lighter to prevent the keel from capsizing. But we want to stay ahead, not behind, of the curve.” In short, in the coming months there will be gradual increases in rates but without forcing one's hand and the return to normal rates after the great recession will take place with due gradualness.
Wall Street welcomed the Easter message of "dove" Yellen without snarks, just as it did not react to the warning that Secretary of State Rex Tillerson launched from the G7 on Italian soil to North Korea. Today Tillerson will be in Moscow for a visit that promises to be very complicated. Meanwhile, Europe is in full pre-election tussle: less than ten days before the first round of the French presidential elections, capitals are sailing towards safe havens, starting with the Bunds.
WELLS FARGO ASKS FOR THE RETURN OF TOP MANAGEMENT BONUSES (75 MILLION)
Weak Asian price lists this morning, unnerved by the Korean crisis. Tokyo (-0,5%) and Hong Kong (-0,8%) fell back. Chinese lists also fell: Shanghai -4%, Shenzhen -0,6%. The exception is Sydney, up 0,4%. Mixed session on the US markets, but final balance: Dow Jones +0,01%, S&P 500 +0,07%, in line with the Nasdaq (+0,07%).
The gains in the energy sector (+0,8%) compensated for the slowdown in financial sector stocks. The accounts of JP Morgan and Citigroup will be announced on Thursday.
Ahead of Thursday's board meeting, the Wells Fargo board announced it will ask the old board to repay $75 million in bonuses already paid against budgetary goals achieved thanks to phantom checking accounts.
OIL, SEVENTH DAY OF UP
Oil still up by about 1,5%: Brent at 55,9 and Wti at 53 dollars a barrel. It is the seventh consecutive day of gains. Oils are among the most awaited in the quarterly season: the rise in prices should allow a 600% jump in profits compared to the previous year. In Milan Eni -0,1%, Saipem +0,1%, Tenaris +0,3%.
THE ELECTRIC CAR IN THE LEAD, SURPASSED GM AND FORD
But the most important news is certainly the historic overtaking of Tesla on General Motors, a week after the one on Ford. The share of Elon Musk's company, with an increase of 2,8%, reached a stock market value of just over 51 billion dollars, against 50,9 billion of Gm. A week ago a similar fate befell Ford (48 billion capitalisation). Driving the boom of the Californian house is the growth in sales (+69% annually), just over 25 units in the quarter. Musk thus demonstrates that he can hit the target of 50 cars produced and sold in the semester, denying the skepticism of many analysts.
Now Musk is aiming for a target of 500 units by 2018 also thanks to the imminent launch of the awaited Model 3 compact sedan. The market believes in it, judging by the success of the recent operations which have made it possible to raise over a billion dollars. Among the new shareholders Tencent, the first Chinese company by stock market value, entered the capital of the Palo Alto company with 5%.
THE MELENCHON RISE WEIGHTS ON THE EU STOCK EXCHANGES
The latest French polls, which see Jean-Luc Melenchon, candidate of the extreme left, in strong recovery, have caused a surge of nervousness on the markets, frightened by possible surprises. Futures signal a slightly lower opening. In Milan, the Ftse Mib index ended the first session of the week with -0,48%, at 20.202 points.
The Cac40 index of the Paris Stock Exchange lost 0,54%. The Frankfurt stock market also fell: Dax index -0,1%. The worst was Madrid (-0,8%), London unchanged.
THE BUND ADVANCES, ITALY, FRANCE AND SPAIN SUFFER
The Italian secondary closed down, in line with France and Spain, a session punctuated by risk aversion linked to the approaching mid-month auctions, uncertainties over the French presidential elections and geopolitical tensions in Syria and North Korea.
The 10-year BTP weakens to 2,24%, from 2,19% at Friday's close.
The spread with the Bund moved to 202 basis points, from 198 basis points on Friday. The spread between the German 4-year and the French 72-year period widened by XNUMX basis points to XNUMX basis points, returning to the levels at the end of February.
In a context of thin volumes, in addition to the rich medium-long offer on the agenda for tomorrow - up to 10 billion in the new three-year, 7 and 20-year BTP and the March 2030 off-the-run - today the Treasury will offer 6 billion in the 12-month Bot against the 6,075 maturing.
In the evening, on the Mts gray market, the stock traded at a yield of -0,235/243%, just below the -0,226% of the mid-March auction and close to the all-time low of -0,250%.
MANEUVER, POSTPONEMENT UNTIL TOMORROW IS NOT EXCLUDED
Today the Council of Ministers should approve a decree on the corrective budgetary measures requested by the European Union: the government should lay the foundations for a reduction of the structural deficit to 1,2% of GDP in 2018, compared to the estimated 2,2% for this year.
We reason with a 1% GDP growth hypothesis in 2017, without any upward adjustments compared to the latest official estimates, because there are positive signs in the first quarter but the 3,4 billion adjustment maneuver risks having a mini-depressive effect. According to a government source, writes Reuters, "it cannot be excluded that the maneuver will be postponed to Wednesday or Thursday". The correction serves to reduce the structural deficit by 0,2 points of GDP already this year, calculated net of the cycle and one-offs.
From Istat communications we learn that the restart of industrial production in February, after the sudden slowdown in January, was less strong than expected. The month-on-month increase was 1%, against the estimated +1,5%. The December 2016-February 2017 quarter closed with an increase of 0,7%.
AVIO IS ALREADY IN ORBIT, A RECORD FOR DIASORIN, IMA AND TECHNOGYM
The starting point for the day was provided by the freshman Avio, which on the day of its debut on the Star after the merger with Spac Space2 rose by 6,6% after reaching a maximum of 13,95 euros. The stock also finds support in the launch of the coverage of Equita with a "buy" opinion and a target price of 15 euros per share. There is no shortage of other positive signs in the list: Diasorin, Ima and Technogym also reach new all-time highs.
FINCANTIERI AND SARAS AT THE TOP
On the upside, Fincantieri shines (+3,68%) after the slide on Friday, when it left 3% on the field. “I think the French acquisition was taken very well and then it's a period in which many contracts are awarded and this increases visibility on the order book”, observes an operator.
Saras strengthens in the finale: +1,08% at the close, reaching a maximum of 1,877 euros, the highest price in the last 14 months. From the beginning of January +8%. Refining margins in the Med area last week rose to 3,90 dollars a barrel from the previous 3,40.
MONCLER, NEW MAXIMUM IN THE LEADER OF LVMH
Spotlight on the luxury sector on the day of the counts of Lvmh, the flagship of Bernard Arnault's empire. The stock closed down by 0,86% at €207,45. The company closed the first quarter with a jump in sales, beating analysts' expectations, but still warned of the uncertainty that continues to characterize the scenario. Sales of the French luxury giant rose by 15% to 9,88 billion euros. LVMH said it saw solid growth in its core markets of Asia, Europe and the United States, but added that "the currently observed trend cannot reasonably be predicted for the full year at present."
Moncler's race does not stop at Piazza Affari: +1,4%, on historical highs. Slight drop for Tod's (-0,1%). Salvatore Ferragamo +0,1%.
BANKS AND UTILITIES WEAK. THUD OF ASTALDI
Banks sold. Intesa Sanpaolo -0,5%. It should be well advanced in the tender for the sale of a €2,5 billion bad loan portfolio.
Bper Bank -1,6%. The assembly was held on Saturday. The list for the new board of directors presented by the historical shareholders obtained 28,5%, against 11,6% for the Assogestioni list. Banco Bpm -0,7%, Unicredit -1,3%, Mediobanca -2%.
Telecom Italia lost 0,5%. The first shareholder Vivendi yesterday presented his list of candidates for the new board of directors. Arnaud De Puyfontaine is indicated as the new president, replacing Giuseppe Recchi.
Weak utilities. Enel -1%: The company completed the purchase of some stakes in two Romanian subsidiaries. A2A -1,2%.
Among industrialists, FCA -0,4%, Stm -0,3%, Leonardo -1,6%. Heavy fall by Astaldi, which worsens down by 2% in the final. Moody's downgraded the rating to B3 on Friday evening, with a stable outlook. The group approved the new 2017-2021 strategic plan a few days ago.
