MILAN, 11 June (Reuters) – Indices in deep red in Piazza Affari, and more generally in European markets, penalized by the gloomy economic outlook outlined yesterday by the Federal Reserve, which as expected has left interest rates unchanged, with the prospect that they will remain close to zero at least until 2022.
“The markets are doubtful on how to proceed and, therefore, it is realized after the rally of the last sessions also following the Fed’s decision from which no news emerged. I would say that it is sales from empty books”, observes a trader.
The Fed has promised its support for the next few years to the economy devastated by the effects of the pandemic and added that it will keep bond purchases at a minimum at current levels.
The yield spread between Italian and German 10-year government bonds narrowed slightly to 184 basis points while, on the commodity front, Brent was down slightly above $ 40 a barrel.
The banks are very badly affected, also penalized by the increase in the spread that weighs on the portfolios of credit institutions. Down the sector at European level with a fall of 4%. In particular, INTESA SANPAOLO and UBI BANCA sold 3.3% and 3.4% respectively. In an interview, the president of Banca Imi Gaetano Micciché said that Intesa is confident that it will be able to overcome the critical issues raised by the Antitrust Authority on Ops on Ubi Banca and that it has no intention of making any changes to the offer. According to press reports, Intesa could transfer a further 50-100 branches to BPER, which lost 3.4%, already heavily hit yesterday, because this hypothesis could lead to a greater outlay by Bper than estimated to date.
Unicredit (-4.5%), Mediobanca (-2%) also fell. Savings managed with Banca Mediolanum also fell by 3.7% and Azimut by 2.5% despite the net inflows of May higher than the brokers’ expectations.
There is no peace for the FCA title in decline even today with a 5.6%, penalized by the prospect of having to face a long EU antitrust investigation for the merger with the PSA and therefore with a probable lengthening of the timing expected for the conclusion of the deal. According to the broker Banca Imi “the EU Antitrust procedure could jeopardize the timing of the merger, whose finalization is expected in the first half of 2021. This could keep the stock under pressure”. Also bad Cnh (-6.7%)
The sales flow on Autogrill continues, targeted again today with a drop of 5.6%. Since the beginning of the year, the stock has sold more than 44%, sensitive to motorway and airport traffic data not only in Italy for the recovery of post lockdown revenues. Atlantia also fell by 6% pending the results of the first quarter with closed markets. Yesterday the announcement that traffic on the motorway network in the past week dropped by 30.4% on an annual basis, while that of passengers on Aeroporti di Roma by 95.5%. According to Equita, “the Aspi figure is positive, because the full reopening has affected 5 days out of 7 of the past week. We therefore estimate that the drop may have been 20-25% on the days of the week of total reopening of the trips”.
Copious sales also on Tim (-5.3%), despite the defensive characteristic of the title.
Resilient, however, utilities such as Snam which sells 1.5%, Enel (-0.8%), while Italgas (+ 0.1%) is collected after the announcement of the guidance for 2020, which implements the impacts of Covid-19, with a revenue target of over 1.3 billion and an Ebitda of between 960-980 million. “Ebitda’s estimates are better than expected, probably due to greater recognition of depreciation on abandoned meters”, writes Equita in the daily.
Lastly, the oil sector is also heavy, with Eni down 3.5% and Saipem (-3.8%).