MILAN – EU stock markets continue to rise cautiously with the composite PMI indicator (summary of manufacturing and services activity) at the top for a year which strengthens the euro.
Investors suspended between the caution expressed by the Federal Reserve in the minutes of the latest meeting, published yesterday, and the long wave of artificial intelligence. US Central Bank policymakers “assessed that it will take longer than previously expected to gain greater confidence that inflation will move sustainably towards 2%,” we read in the minutes, confirming that the Fed wants to be cautious with rate cuts. Today, it was the vice president of the ECB who spoke: for Luis de Guindos, interviewed by Oberosterreichische Nachrichten, an interest rate cut of 25 basis points by the ECB in June would be “a prudent approach”. For the European banker “we were very transparent about the decision at the June meeting. And we are adopting a prudent approach, which argues in favor of a reduction of 25 basis points”.
Last night, returning to the USA, they arrived to support the markets Nvidia’s accounts, the chipmaker that is riding the artificial intelligence boom. Numbers like a +262% of sales in the last quarter, which pushed the stock into post-trading on Wall Street. The results achieved and the prospects outlined by the management have generated a flow of purchases which, if it continues in today’s regular trading, will lead to a growth of 140 billion in the market valuation, calculates the Bloomberg. That is, it could earn more in one fell swoop than the entire capitalization of Intel, which was once the undisputed leader of the chip market. Just to understand the times that pass, the financial agency points out that Nvidia’s expected 28 billion quarterly sales would be more than double those expected by Intel.
XTB analysts remarked that the strength of the stock, projected above a thousand dollars, led to one “stock split” 1 to 10i.e. a split of the shares which will involve a “division by 10” of the price to allow “greater attractiveness of the stock and greater liquidity on the same”.
In general, Asian trade moved positively (Tokyo closed at +1.3%) after this news and the chip index of Bloomberg it rose by approximately 2 percentage points.
- 11.31am
The EU composite PMI has been at the top for a year
- 08:10
The Tokyo Stock Exchange closes higher: +1.2%
2.22pm
Bloomberg: Eni considers sale of 20% of Enilive
Eni is considering selling a 20% stake in its Enilive biorefining unit after receiving expressions of interest from potential investors, Bloomberg reported, citing people familiar with the matter. The company values the entire business at around 10 billion euros, sources told the news agency, adding that negotiations are at an early stage while Eni is still evaluating options for Enilive. According to Corriere della Sera, investment companies such as Blackrock, Brookfield, Ifm Investors and Macquarie have shown interest so far.
1.43pm
EU cautiously rising mid-session
European stock markets are proceeding weak and cautiously rising. In Frankfurt the Dax advances by 0.20%, London travels at parity, in Paris the Cac 40 rises by 0.30% and in Madrid the Ibex-35 marks -0.01%. In Milan the FTSE MIB gains 0.30%.
1.42pm
Türkiye, rates on hold
The Turkish Central Bank is keeping the reference interest rate stable, linking this decision to inflation and underlying pressures, which are still too high. The institute therefore kept the one-week repo at 50%, in line with the expectations of a survey of economists conducted by Factset. The Bank has gradually raised the interest rate from 8.5% since June last year, having last raised rates in March. “The underlying trend in monthly inflation saw a limited decline in April,” the bank said in a statement. Hence the decision to keep rates steady.
11:54
ECB, strong wage growth in the Eurozone: +4.7% in the first quarter
The index that monitors the trend of negotiated salaries in the euro area rose, on an annual basis, by 4.7% in the first quarter, marking an acceleration compared to the 4.5% in the last three months of 2023. The data – which belies economists’ estimates for a deceleration or stabilization – indicates a return to record levels in the third quarter of 2023, and does not respond to the expectations of deceleration which should favor the decline in inflation, justifying an easing of monetary policy by Frankfurt.
11.31am
The euro strengthens
The euro/dollar exchange rate is rising sharply to 1.0845 after the PMI index that monitors overall economic activity in the euro area rose to 52.3 in May, reaching a one-year high. The value is above expectations and signals that the economic recovery is consolidating.
11.31am
The EU composite PMI has been at the top for a year
The PMI for tertiary activities in the eurozone remained unchanged at 53.3 in May. This was announced by S&P Global. The figure is lower than expectations which pointed to growth of 53.6. The manufacturing PMI rose to 47.4 (from 45.7 in April and against estimates for 46.2), to its highest level in 15 months. The composite PMI for eurozone production thus advanced to 52.3 (from 51.7 and against expectations to 52), the highest it has been for a year.
09:30
WeBuild collapses on the stock market after Salini bond placement
Webuild down on the stock exchange due to the technical effect of Salini’s offer of secured bonds exchangeable into Webuild ordinary shares for 225 million: the stock lost 9.2% to 2.08 euros in the early stages. Salini placed those bonds to early repay existing bank financing (underwritten with Intesa Sanpaolo or its associated companies) and for other general corporate purposes. The bonds will have a quarterly coupon of 4% and, subject to exchange, early redemption or repurchase and cancellation, the bonds will be redeemed at 100% of their principal value on May 30, 2028. The initial implicit trading price of the bonds was set at 2.60 euros, corresponding to a 25% premium on the reference price of the share, corresponding to the placement price of the accelerated bookbuilding. The bonds will be secured by a pledge of shares corresponding to 2.5 times the number of shares underlying the bonds.
09:29
Mfe runs after the accounts
Excellent reception in Piazza Affari for Mfe-Mediaset’s accounts for the first quarter of the year, all above analysts’ estimates with a profit boom: Biscione’s B stock, the most representative one with ten voting rights, starting trading rises by 3% to 4.1 euros, the A share grows by 2.8% above three euros.
09:29
Milan cautiously rising
Positive start to the session for the stock market, in line with the rest of Europe. The Ftse Mib index marks +0.39% at 34,594 points. Piazza Affari, fresh from three consecutive declines, seems to want to relaunch the initiative, having already digested the Fed’s minutes which affected Wall Street yesterday, dampening hopes of a rate cut. “The disinflation process – the minutes say – will probably take longer than previously thought”. Meanwhile, on the macro front, the May data on SMEs in the Eurozone are arriving today, which will provide indications on the health of the economy. Also expected in the morning are the ECB data on wages in the euro zone, on which the decision on the first cut in the cost of money could depend. Banks are doing well on the list with Unicredit +0.7%, Intesa +0.4%, Sondrio +1.3%, Bper and Bpm on +0.6%; among financial people on Poste. Other increases for Ferrari (+1%), Tim (+0.8%), STM (+0.9%), Stellantis doing well (+1.4%). Energy is weak, with Enel -0.7%, Italgas -0.4%, Terna -1%.
09:11
Stellantis launches the second tranche of the buyback
Stellantis launches the second tranche of the share buyback program announced on February 15, 2024 with coverage of up to 3 billion euros. The company has entered into an agreement with an investment firm that makes its own trading decisions on the timing of purchases independently of Stellantis. The agreement concerns a maximum amount of up to 1 billion euros. The second tranche of the program will start today 23 May and will end no later than 30 August. The company intends to cancel the ordinary shares acquired through the 3 billion euro share buyback program – it explains in a note – with the exception of a portion of up to 0.5 billion euro, which will be used for future share ownership plans for employees and stock-based compensation plans. The aim is to promote the benefits of broadening and strengthening our teams’ culture of share ownership, whilst avoiding dilution of existing shareholders. To date, the residual part of the authorization is equal to approximately 297 million shares and the company holds 172,498,930 of its own ordinary shares equal to 4.28% of the total issued share capital, including ordinary shares and special voting shares.
09:09
European stock markets open mixed
The main European stock exchanges open mixed sessions. In the first minutes of trading, Piazza Affari recorded an increase of 0.24% to 34,539 points, Frankfurt recorded +0.29%, Paris recorded +0.27% and London lost 0.03%.
08:10
The Tokyo Stock Exchange closes higher: +1.2%
The Tokyo stock market closes higher thanks to the positive results of the US chip giant Nvidia. The benchmark Nikkei 225 index gained 1.26% to end at 39,103.22 points, while the broader Topix index rose 0.64% to 2,754.75 points.
08:00
Oil falling
Oil prices fell in Asian markets in a fourth consecutive session of losses as uncertainty over the timing of the Federal Reserve’s interest rate cuts weighed on the demand outlook. WTI futures lost 0.63% to 77.08 dollars a barrel, Brent futures lost 0.49% to 81.49 dollars.
07:59
US futures are trending higher
Wall Street futures rise after yesterday’s negative close. The New York Stock Exchange seems to have digested the indications from the minutes of the latest Fed meeting which have dampened hopes of an upcoming rate cut. The Dow Jones advances by 0.15%, the S&P 500 rises by 0.63% and the Nasdaq gains 0.97%.
