by Stefania Arcudi and Stefania Blasioli
Investors’ eyes are on tensions in the Middle East. De Guindos (ECB) reiterates his openness to a rate cut if the inflation trajectory is confirmed. Asia catches up late with chip makers under special watch. Euro/dollar remains below 1.07
3′ reading
(Il Sole 24 Ore Radiocor) – European stock markets begin the session at the right pace, continuing on the path of the previous day’s rises, in the wake of Asia and ignoring the fourth consecutive decline on Wall Street. Investors are encouraged by the hope that the ECB can proceed with a rate cut in June, fueled by the words of President Christine Lagarde from Washington and also given the confirmation of the slowdown in inflation in the Eurozone.
In this context, the Vice President of the ECB, Luis de Guindos, presenting the 2023 annual report before the Committee on Economic and Monetary Affairs of the European Parliament, reiterated that «if our updated assessment of the inflation prospects, the dynamics of the underlying inflation and the transmission strength of monetary policy should further increase our confidence that inflation is converging towards our target in a lasting way, it would be appropriate to reduce the current level of restrictive monetary policy”.
It is more difficult to make predictions about the Federal Reserve’s next moves, given that the Beige Book did not help to clarify ideas and the president of the Cleveland Fed, Loretta Mester, said it will take months of encouraging data to convince her that inflation is up a sustainable path towards the annual target of 2%.
Meanwhile, new American macro data are awaited and the work of the International Monetary Fund and the meetings of the G20 finance ministers continue in Washington, from which useful indications may also emerge on the geopolitical tension front. In the Old Continent, however, the spotlight is on the extraordinary European Council and the interventions of some representatives of the ECB, including the number one of the Bundesbank and member of the Eurotower Board of Directors, Joachim Nagel.
Thus Milan rises (FTSE MIB), as does Paris (CAC 40), Frankfurt (DAX 30) and London (FT-SE 100). Madrid (IBEX 35) is moving faster, while Amsterdam (AEX) is further behind.
In Piazza Affari, banks are in light, oil companies are in the queue
As for the stocks, on Piazza Affari Brunello Cucinelli had managed to gain over 2% in the early stages and then settled at parity, after the increase in revenues and confirmation of the guidance. The banks are still in the spotlight, with Banca Pop Sondr, Unicredit and Banca Mpstra the best. In the queue are the oil companies (Saipem, Eni) and Stmicroelectronics, which for the moment is not benefiting from the positive accounts of the Taiwanese giant Tsmc, which among other things is accelerating on artificial intelligence. Outside the main list, Mfe accelerates after the accounts and the dividend, and Ovs also runs after the coupon and the 2023 results in line with the preliminary and expected indications.
Asia closes higher, chip producers under scrutiny
Stock markets in Asia experienced a bullish session, “a market reaction determined by the pause in the dollar’s rally and the increase in US bond yields” explain the analysts. Tokyo closed up by 0.31%, Shanghai by 0.45% Shenzen by 0.57%, Hong Kong (session still in progress) gains 1.25 percent. The won led Asian currencies’ rise against the dollar, while the yen remained stable after U.S. Treasury Secretary Janet Yellen’s first trilateral meeting with the finance ministers of Japan and South Korea.
Among the stocks under scrutiny are Asian chipmakers such as Taiwan Semiconductor and Tokyo Electron after ASML said on Wednesday that orders slumped in the first quarter and its sales in China will likely be hampered by U.S. export control measures.
Euro/dollar below 1.07, oil falling
On the currency market, the euro remains below 1.07 dollars and changes hands at 1.068 (from 1.0637 on the day before). The euro/yen exchange rate is at 164.82 (from 164.54) and the dollar/yen exchange rate is at 154.217. Oil is falling, with May WTI futures in the area of 82 dollars a barrel and June Brent futures at 86.7 dollars. Natural gas traded in Amsterdam marked a first position at 30.82 euros per megawatt hour and is currently falling by 2% to 30.65 euros.
Spread between BTp and Bund stable at 140 points, yield at 3.84%
Stable spread between BTp and Bund. At the beginning of the session, the yield differential between the benchmark ten-year BTp (Isin IT0005560948) and the German Bund stood at 140 basis points, the same value as the last reference. However, the yield of the benchmark ten-year BTp fell, opening trading at 3.84% from 3.87% the day before.
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Stefania Arcudi
Radiocor editor
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2024-04-18 08:04:36
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