MILANO – Weak start for the European stock exchanges in the aftermath of the expected decision by the Fed. The American central bank has slowed down the path of raising interest rates, raising them this time by only 50 points after the flurry of hikes from 75. A similar decision is expected today by the European Central Bank, with Frankfurt expected to limit itself to a rate hike of 0.5%. More than the hike itself, what disappointed investors yesterday was the firmness with which the Fed clarified that the restrictive policy adopted up to now will remain “for a while”, thus leaving no room for a reversal of strategy, despite the recent data on US inflation have marked a marked slowdown in price growth.
The day was also down on the Asian side, with Tokyo closing trades at -0.37%.
A declining start for the European stock exchanges
The European stock exchanges open in the red awaiting the decision of the ECB and in the aftermath of the choice of the Fed which, in the face of inflation does not yet allow the pace of interest rate hikes to be reduced, has further increased the cost of money by 50 basis points, meeting analysts’ expectations. Today the European Central Bank is to announce its monetary policy decision which looks set to follow in the footsteps of the United States.
At the start, Piazza Affari dropped 0.60% to 24,425 points, while Frankfurt also fell -0.77%, Paris -0.75% and London -0.67%. In Milan runs Saipem +1.36% which has been awarded new contracts in Guyana and Egypt for a total value of approximately 1.2 billion dollars. Around parity Tim, Leonardo and Enel, decreases of almost a point and a half percentage instead for Tenaris, down also Stm -1.7% and Moncler which loses 1.75%.
The spread opens up at 192 points
Spread between 10-year BTPs and German Bunds up slightly at the start of the session: the differential opened at 192 basis points against 190 at yesterday’s closing.
Treasury yield is 3.9%
The euro opens weak waiting for the ECB
The euro opens down against the dollar and the yen pending the ECB’s monetary policy decision. The single currency changes hands at 1.0657 dollars and 144.62 yen. The greenback rallied broadly after the Federal Reserve raised interest rates by half a percentage point, as widely expected, and announced it expects more hikes and to keep rates high longer than previously hoped. The dollar also advanced against the Japanese currency to 135.71.