(Il Sole 24 Ore Radiocor) – Advance sectors Commodities, technology and banking They pushed the European listings that closed the last session of the week with positive territory. Following the price hike by European Central Bank By 75 basis points, with investors convinced that monetary tightening of central banks is now practically discounted by the market, in Avary Square the Ftse Mib is up 1.92% above 22,000 points, buoyed by financial stocks, which will benefit from more restrictive ECB policy , with increased interest margins. In Frankfurt, the Dax40 rose 1.43%, in Paris, the Cac40 rose 1.41%, in Amsterdam the Aex rose 1.72% and in London, the Ftse100 rose 1.23%, on the day the Bank of England decided to postpone the decision on interest rates from 15 to September 22, as a sign of condolence and respect for the death of Queen Elizabeth II, who passed away yesterday at the age of 96 and after 70 years of rule. Meanwhile, on the other side of the ocean, the market is now convinced that Federal Reserve It will raise interest rates – at the end of the next meeting on September 20-21 – by 75 basis points for the third time in a row. Looking at securities, banking, energy and managed savings in the Milan spotlight.
On Thursday, the European Central Bank raised interest rates by 75 basis points, the largest rise in Eurotower history, and President Christine Lagarde triggered a stagflation scenario, with downside risks for the economy and upside risks for inflation. Encouraging signs on the consumer price front came from China, where inflation unexpectedly slowed in August.
7 billion BoTs are allocated annually, the highest performance since 2012
Meanwhile, the Treasury Department granted annual BoTs of 7 billion, equivalent to the full amount offered, against a request of 9.156 billion, with a coverage ratio of 1.31. The yield jumped more than 110 basis points to 2.091%, which had stood at 0.944% in the previous auction. To find a return on 12-month BoTs above 2%, it is necessary to go back to the August 2012 auction when it came to 2.677%.
Wall Street is heading for a positive week
Wall Street rose, with indicators moving towards the first positive week of the last four. Yesterday, Federal Reserve Chairman Jerome Powell reiterated the need for the US central bank to continue raising interest rates sharply to curb inflation. “We cannot ease monetary policy prematurely,” Powell warned. Fed Vice Chair Lyle Brainard said the fight against inflation would continue “for as long as necessary” and said she was “confident that we will be able to return to inflation at 2%.” Investors are now confident that the Federal Reserve will raise interest rates – at the end of its next meeting on September 20-21 – by 75 basis points for the third time in a row. The strength of the labor market indicates that the Federal Reserve will maintain its aggressive policy, with new claims for unemployment benefits falling for the fourth consecutive week, the Labor Department reported yesterday.
Banks in light of high interest rates supports revenue
Looking at securities, banking, energy and managed savings in the Milan spotlight. They finished at the top of the main part Intesa San Paulo (+5.33%), Finecobank (+ 5.02%) and Tenaris (+4.98%). The signal corresponding to Recordati (-0.88%). Among the banks, Banco Bpm (+3.185) and Bper (+2.82%) stand out. “The three-month Euribor curve to the end of 2023 points to a figure in the region of 2.4%, indicating further increases of over 160 basis points,” Equita analysts note. They add, “Entering in a positive and gradually rising rates scenario clearly constitutes an element of support for the profitability of the banking sector, as well as broadening the scope of safety to deal with a potentially dangerous macro deterioration.” “Monetary tightening” is “positive for Italian banks’ interest margin”, agreed by Banca Akros. They added that the suspension of the two-tier system to compensate for excess reserves would also have positive effects, thanks to “deposit rates higher than those of Tltro.”
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