MILANO – The explosion of Chinese protest against the very strict restrictions for Covid cast a shadow on the reopening of the financial markets. The Asian Stock Exchanges move under the banner of weakness, while the Treasury (safe haven for investors) appreciates and oil pays the bill for fears of the impact on the economic performance of the situation in Beijing. “The markets will respond negatively to a spread of protest and an increase in cases” of contagion, “which will probably generate new problems in supply chains and hurt consumer demand, at least in the short term,” said Gabriel Wildau of Teneo Holdings at Bloomberg summarizing the concerns of the markets. Investors are also always keeping an ear to the central banks: a speech by Jerome Powell is expected during the week (Wednesday) and data on the US labor market will arrive on Friday.
European stock exchanges extend the declines
European stock markets continue to decline. Protests in China raise concerns about the social and political stability of the world‘s second largest economy. Violent demonstrations by the population are raging in the country against the severe restrictions put in place to counter the spread of Covid. In Frankfurt the Dax loses 0.87%, in London the FTSE 100 drops 0.34%, in Paris the Cac 40 drops by 0.89% and in Madrid the Ibex-35 scores -0.90%. In Piazza Affari, the Ftse Mib drops by 0.94%.
Gas futures up to 125 euros in Amsterdam
Start of the day on the upside for gas prices at the TTF hub in Amsterdam. The future for delivery in December marks a price of 125 euros, with a gain of 0.51%.
Cautiously rising spread below 190 points
The spread opens higher. The differential between the BTP and the Bund is 188 basis points. The change is +7.48%. The yield on the Italian 10-year bond is +3.85%.
Milan weak at the start
A declining start for the Milan Stock Exchange which pays, like the rest of the European lists, for the overheating of protests against zero Covid policies. The Ftse Mib index dropped 0.63% to 24,564 points. However, attention remains focused also on the policies of the central banks, pending this afternoon’s hearing of the president of the ECB, Christine Lagarde, in the European Parliament and the intervention of the number one of the Fed, Jerome Powell, at the Brookings Institution on Wednesday. Tim drops 1.57% on rumors that CDP shouldn’t bid for the network. Oils are bad, with crude oil down by more than 3%: Tenaris down by 2.66%, Saipem by 2.21% and Eni by 1.57%. Among the few stocks on the rise, Leonardo stands out which rises by 0.65%, Atlantia which advances by 0.30% and Terna which gains 0.27%.
Futures also down on Wall Street
Wall Street futures are down, awaiting Jerome Powell’s speech on Wednesday and US job market data on Friday. The Dow Jones scores -0.47%, the Nasdaq drops 0.88% and the S&P 500 drops 0.67%.
Oil at peak, Wti below 75 dollars
Oil prices are falling sharply as protests in China over the zero Covid policy fuel demand concerns. Futures on Brent lose 2.50% to 81.53 dollars a barrel while those on WTI lose 2.85% to 74.10 dollars a barrel.
Asian stocks drop, Tokyo loses 0.4%
Asian stock markets are continuing to decline, weighed down in particular by protests in the streets in many Chinese cities against Beijing’s zero Covid strategy. The Nikkei on the Tokyo Stock Exchange lost 0.42% at the close. In China, the Shenzhen index drops by 1.43%, while Shanghai drops by 1.20%. In Hong Kong, the Hang Seng index marks -2% after losing more than -3.5%. The Kospi was also negative, dropping by 1.18%.