MILANO – 11 am. It is another difficult day for the European markets. The stock exchanges restart heavily after the black Friday that saw Piazza Affari leave more than 5 percentage points on the ground. In the middle of the morning, Milano still drops two percentage points, London lose 0.9%, Frankfurt ill’1,52% e Paris l’1,49%.
The turning point of the ECB, which is about to raise rates with the next meeting in July, continues to fuel the concern of investors already grappling with fears of a sharp slowdown in growth. And for the United States, the recession could come as early as next year. At least this is the result of a survey conducted by Financial Times with Initiative on Global Market. 40% of economists surveyed predict that the National Bureau of Economic Research will declare recession in the first or second quarter of 2023 while for a third of respondents it will do so in the second half of next year. However, the week looks above all to the Fed meeting tomorrow and Wednesday, from which new indications are expected on the path of rate hikes taken by the US Central Bank. If until a few days ago it was assumed that an upward adjustment of 50 points in June was taken for granted, after last Friday’s reading with US inflation above expectations, the market went so far as to hypothesize a rise of 75 basis points.
Reasoning that pushed up the yield on Treasuries, the ten-year American government bonds, to the highest since the autumn of 2018 above 3.2%. There was also a strong sell-off on Eurozone stocks, with the German two-year bond yield above 1 percent for the first time in more than a decade. Italian government bonds do not escape this dynamic and continue to be the target of sales. The spread at the start it rises to 238 points, at the top since May 2020, with the yield of Italian securities which – after reaching 3.9% – at mid-morning marks 3.85%, the highest since 2014.
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Asia is also suffering, weighed down by the new risk of lockdown anti-Covid in Cina. Beijing authorities were quick to contain a new outbreak, forcing millions of people to undergo testing and forcing new targeted closures, while Shanghai completed mass testing for most of the 25 million residents over the weekend. Heavy closing of Tokyowith the Nikkei leaving 3.01% on the ground. Shanghai loses 0.9%, Only il 3,52%, Hong Kong 3.4%. At least it yen which touches the negative record in 23 years, at 135.20, on expectations of a further widening of the interest rate differential between the United States and Japan.
Increasingly related to risky assets, the Bitcoin moves sharply and goes below 25 thousand dollars, to a minimum that has not been recorded since December 2020. The queen of cryptocurrencies, in fact, currently stands at 24,487 dollars, after a decline of more than 11 percentage points in the last 24 hours. Negative performance also for Ethereum which loses 15.47% to 1,244 dollars. This increases the correlation between the crypto world and risky financial assets, those put in greater difficulty by the Fed’s monetary tightening and therefore by the generalized rise in rates. Antoni Trenchev, of the Nexo platform, speaking with Bloomberg explained: “We hear that there are forecasts on Bitcoin in the parts of 10-15 thousand dollars or even in ‘single digits’ (ie under 10 thousand, ed), which says a lot about that kind of macro environment the crypto world is facing for the first time, and fear levels. ” What’s more, after the Earth / Moon affair in these hours the difficulty of a single platform has been staged again: the cryptocurrency lending company Celsius reported that it will suspend all withdrawals, exchanges and transfers between accounts “due to extreme market conditions”.
L’euro is down sharply against the dollar at 1.0485, down 0.26%, and the pound also fell 0.43% to $ 1.2259, drawing little support from the Bank’s expectations of a rate hike of England.
Burdened by the general climate of the markets, the prices of the Petroleum the decreases widen, with Brent losing 2% and slipping below 120 dollars a barrel. The WTI loses 2.14% to 118.09 dollars. Gasoline prices in the US also averaged over $ 5 a gallon for the first time on Saturday, extending a rise in fuel costs that is driving soaring inflation.