Markets in tension awaiting the Fed’s decision. The uncertain start on Wall Street does not support European stock markets, which continue to decline today. The exception is Frankfurt (+0.14%), where Basf (+3.8%) stands out thanks to rumors of a possible listing of the agrochemical division in the coming years. The rest of the markets remain weak: London closes at -0.65%, Paris at -0.34%, Madrid at -0.14% and Milan at -0.2%. Overseas, Wall Street remains below par (Dow Jones -0.08%, S&P -0.12%, Nasdaq -0.2%) awaiting the Fed’s decisions and statements by Chairman Powell. Government bond yields are stable, with the 10-year BTP at 3.57% and the BTP-Bund spread at 138 points. In the United States, the 10-year Treasury yield stands at around 3.7%. The euro/dollar exchange rate also remains unchanged at 1.11 awaiting monetary policy updates.
Stock Markets 12:00: Milan at parity
At around 12 o’clock, Business Square is holding close to parity as all eyes are on central bank meetings, the Fed and beyond. Villeroy, governor of the Bank of France, has sounded optimistic about further rate cuts after last week’s. Markets, meanwhile, are waiting to see how big the Fed might cut rates later tonight.
In Milan, Banco Bpm stands out with a rise of 2.3%, followed by Leonardo, Tim and Bper, which earn about 1.5%. However, Campari is in sharp decline, losing 4.5% after the unexpected exit of the CEO. Poste Italiane also records a decline of 2.3%, while Brunello Cucinelli and Moncler fall by 1.7%.
Meloni: “Brilliant results from the stock market”
Meanwhile, Giorgia Meloni, in her speech at the Confindustria assembly, also spent words of praise for Piazza Affari, which has been recording good results for several weeks: “The results of the Italian Stock Exchange are brilliant, it is recording the best performance in Europe, among the best in the world”, affirmed the Prime Minister.
The 30-year BTP issue was also a success: “The new 30-year BTP was issued a few days ago, with over 400 investors participating, for a total demand that exceeded 130 billion euros compared to the 8 billion offered by the Treasury. It is the value of the trust that is placed in Italy and it is a record value that had never been recorded before,” Prime Minister Meloni claimed. “The newfound appeal of government bonds is one of the data that I like the most.”
Stock Market 9am: Europe uncertain awaiting the Fed, Leonardo and Generali doing well but Campari collapses
Waiting for the decision of the Fed on rates, European stock markets open with great caution. The main index of Milan marks a slight +0.06% to 33,800.78 points, Paris recorded a modest +0.03% at 7,489.85 points, while Frankfurt started weakly with a cautious +0.02% at 18,729.64 points. London was the only one to decline, by 0.19%, settling at 8,294.27 points.
Weak start for Milan, luxury bad
Among the biggest increases of the day at Piazza Affari, the following stands out: Leonardo, which marks an increase in 2.27%, reaching 20.30 euros, followed by Bpm Bank with a rise of the1.10% at 6,078 euros. Also A2A records a good performance, rising by 0.87% at 2.091 euros, while Generali advances by 0.62% to 25.96 euros after its exit from Türkiye.
At Piazza Affari Moncler slips of 1.5% following the accelerated sale of a package of shares by the Rivetti family holding company, which held 2.7% of the capital. The luxury sector also appears weak, with Brunello Cucinelli down 1.2%, while in the technology sector Stmicroelectronics loses 1.1%. Sharp decline also for Italian Post Officewhich marks a -2.76%.
But what is making the news today is the collapse of Campari, which, following the resignation of CEO Matteo Fantacchiotti, saw the stock first suspended, then return to the list but with a -6.13%. The manager, appointed last April, surprisingly resigned with immediate effect, citing “personal reasons”. Campari announced this in a note, specifying that the termination of the contract occurred by mutual agreement. Negotiations are currently underway to define the terms of the severance pay. In the meantime, the group has begun the search for a new CEO, setting up a transition committee.
What to expect from the Fed
European stock markets are therefore maintaining an uncertain trend, with investors waiting for the Fed’s decision on interest rates before taking significant positions.
Despite better-than-expected data on retail sales and industrial production in the United States, the FedWatchToolthe probability of an interest rate cut of the 0.5% rose to 67%, while that for a single cut of the 0.25% has fallen to 31%. However, the prevailing view is that the Fed will opt for a 25 basis point reduction, given that the US economy seems headed for a soft landing.
On the macroeconomic front, UK inflation rose 2.2% in August compared to the same period in 2023, confirming the July figure and economists’ expectations. Core inflation, which excludes energy and food, rose to 3.6%, accelerating from 3.3% in July but still in line with market forecasts.
Spread at 136 points
The spread between BTPs and Bunds opens stable, with the yield differential between the benchmark 10-year BTP and the German Bund of the same maturity settling at 136 basis points, in line with yesterday’s close. The yield on the benchmark 10-year BTP records a slight increase, rising to 3.51% from 3.50% at the last reading.
