How to invest in the stock market next week
Let’s start with the facts. The blue chip index, the Ftse Mib (INDEX: FTSEMIB), since the end of March it has moved within a narrow price range. A lateral movement that has a lower limit of 16,300 points, the lowest recorded in the last week of March. And as an upper limit, the threshold of 17,900 points, the maximum recorded in the first week of April.
Only a weekly closure above or below these two levels can determine a decisive movement in one direction or another. We emphasize that the closure must be weekly. In fact, already at the end of April, prices had exceeded the resistance of 17.900 points, reaching a midweek maximum of 18.300 points. But the end of the week was below the 17,900 point mark. And from that moment the index no longer had the strength to go up.
The factors that influence the Milanese list prices
In the last few sessions of the week that just ended, the Italian stock exchange recorded significant losses on the shares of the main bank stocks. On the other hand, the spread level remained stable at 230 points. But only thanks to the purchases of the ECB.
What link is there between spreads and banks? The spread is the yield differential between the BTP and the Bund. If this widens, it means that the cost of Italy’s debt rises. The higher the spread the more the risk of unsustainability of our debt increases. Our banks and in particular Unicredit and Intesa have a good share of our public debt. Factor that weighs on the health of their balance sheets. In the event of hypothetical insolvency of the Italian debt, the banks would be the first to suffer losses.
The market at this time does not trust our public debt, and does not trust to buy bank shares. The problem is that the weight of the bank stocks on our list is significant. If banks don’t go back to being bought, Overall, Piazza Affari will never be able to recover the losses suffered in March.
So even next week, bank stocks remain the special observed to understand the health of our stock exchange.
projections daily, weekly and monthly on the Ftse Mib future