Fluctuating Thursday for the markets. Piazza Affari, after an initial negative reaction to the record rise in rates of 75bp by the ECB, has recovered the slope also exploiting the positive tone of Wall Street. In closing, the Ftse Mib marks + 0.88% at 21,678 points.
The ECB held the spot today and raised interest rates by 0.75 basis points, in a move expected by the market. The ECB has anticipated that in the future there will be further hikes for “different” meetings. Lagarde specified that by “different” we mean two to five meetings, including today’s one. However, the Institute reiterated that the decisions will be taken “meeting-by-meeting” and based on the evolution of the data. The new economic estimates of the ECB staff are now for a GDP growth of 3.1% in 2022, 0.9% in 2023 and 1.9% in 2024. Inflation is instead seen at 8.1% % this year and 5.5% in 2023.
“For the ECB in the coming quarters, the possible recessive climate will make it necessary to stop an excess of rate hikes, especially if in the meantime the EU has managed by October to agree on mechanisms to contain the expensive energy borne by consumers”, argues Antonio Cesarano, Chief Global Strategist of Intermonte.
Still on the central bank front, the chairman of the Federal Reserve, Jerome Powell, spoke again today, reaffirming that the central bank is “strongly committed” to controlling inflation. “History strongly warns against premature easing of politics – said Powell -. I can assure you that my colleagues and I are strongly committed to this project and will continue it until the work is finished ”. Powell kept the option open for another 75 basis point move after those in June and July. The decision depends on the totality of the incoming data. “There is nothing in Powell’s comments to suggest an imminent moderation in the pace of rate hikes,” comment experts from Ing.
In Piazza Affari, substantial increases for banks in the wake of the maxi-rise of the ECB. Banco BPM gained 5.16%, beaten by Unicredit with + 6%. Toniche also Bper (+ 3.09%) and Intesa (+ 2.38%). Among the best of the day is also Fineco (+ 2.76%) which reported net inflows of € 343 million in August, bringing total net inflows from the beginning of the year to € 7 billion.
On the opposite front, yet another session to forget for TIM (-5.15%) with the stock slipping to new historical lows in the 0.19 euro area. The strong weakness of the last few sessions comes in the wake of the new tensions within Tim’s Board of Directors and in particular between the two majority shareholders Vivendi and Cassa Depositi e Prestiti (CDP) on the central theme of the single network. Vivendi estimates the value of Tim’s network in a range of between 31 and 34 billion euros, while CDP believes that this value would not facilitate negotiations on the project. As for the evaluation Labriola, in yesterday’s meeting with Tim’s over a thousand managers, he stated that “several investment banks tell us that the average value of the sum of Tim’s parts is well above what we they said earlier ”. Labriola believes the stock is “widely undervalued”.