March 24, 2023

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Stock Exchanges Today, March 8th. Positive Europe. Lagarde: “We will do whatever it takes to combat inflation”

European markets closed cautiously higher – and turned around mid-session – following the words of Federal Reserve Chairman, Jerome Powell, who made clear yesterday in the US Senate that the central bank is ready to accelerate the pace of raising interest rates again to counter inflation which is falling. Very slowly, while the economy is holding up more than expected. The hawkish rhetoric generated the expected reaction: higher Treasury yields, lower stock futures, and a strengthening dollar. Powell himself returned to rates on the second day of the hearings: “No decision has been made — he made clear — the Fed’s decisions will be guided by data and evolution.”

As for the European Central Bank, analysts at Abn Amro have updated their forecasts for interest rates in the eurozone. A slowdown in core inflation, the economy stabilizing better than expected despite a slowdown in progress and comments filtered by the toughest part of the board has prompted an upward revision of the filing rate estimate, which should peak at 3.75% in the middle of the year. An increase of 50 points in March and May, and then 25 points in June. The previous peak at 3% was seen in March. A reversal with a rate cut is now not expected before December, whereas previously the focus was on October. President Christine LagardeAt the same time, he reassures again, as he did recently in an interview a few days ago, that “we will do whatever is required against inflation,” echoing Whatever it takes – whatever it costs Which Mario Draghi spent to save the Euro.

European stock exchanges are closing cautiously

European stock markets closed higher after Federal Reserve Chairman Jerome Powell’s comments about raising interest rates and looking at the Beige Book. Investors’ attention is focused on the next moves of central banks as the debate over the intensity of monetary tightening continues. Before more accurate indicators, government bond yields stalled. Close positive for Frankfurt (+0.46%) and London (+0.13%) while Paris is weak (-0.2%). More dovish words expressed by the Fed’s number one today helped Piazza Affari which eventually posted a 0.54% gain.

Banca Generali, net inflows +442m in February, +859m in 2023

Banca Generali achieved positive net inflows in February of 442 million, bringing the cumulative year-to-date to 859 million. This is what we read in the note. The inflows in January were positive of 417 million while in February 2022 they were positive of 496 million.

Fed, Powell: “There is still a decision in March, we will evaluate the following data”

No decision was made about raising interest rates in March […] We are not on a specific path, we will be guided by the following statements […] Important data will be announced before the next meeting. Federal Reserve Chairman Jerome Powell said during his presentation of the semi-annual report on monetary policy before the US House of Representatives Finance Committee, after speaking yesterday before the Banking Committee Powell, and then said, like yesterday, that prices will have to rise more than previously expected.

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The euro closed with a slight movement

The euro closed slightly in a session that saw the dollar rise to a three-month high, after the hawkish tone used by Federal Reserve Chairman Jerome Powell in his congressional hearing before easing slightly. The exchange rate between the greenback and the European single currency finally stabilized in the 1.0550 area, with investors waiting for US labor market data to be released on Friday that may or may not confirm the central bank’s threat to raise interest rates beyond what was initially expected. If the stars and stripes economy does not present clear signs of cooling. Meanwhile, the yen strengthened, rising to around 136.90 against the dollar and around 144.25 against the euro.

In the USA, the number of private sector employees increased by 242 thousand

The US job market grows in February. The private sector, as calculated by Adp, created 242,000 new jobs, a solid acceleration compared to +119,000 in January (data revised upwards from +106,000). This number is also much higher than the 200,000 additional employees estimated by analysts. The ADP estimate is based on aggregate wage data for more than 25 million American workers and is independent of official Labor Department data, which is expected on Friday.

US, employment grows more than expected in the private sector: +242,000 employees in February

The US job market grows in February. The private sector, as calculated by Adp, created 242,000 new jobs, a solid acceleration compared to +119,000 in January (data revised upwards from +106,000). This number is also much higher than the 200,000 additional employees estimated by analysts. The ADP estimate is based on aggregate wage data for more than 25 million American workers and is independent of official Labor Department data, which is expected on Friday. Moreover, the Fed’s reflections on the next rate hike will depend on official data.

Lagarde: “We will do whatever it takes to fight inflation”

As President of the European Central Bank, I have a mission of “crucial importance which is price stability which means fighting inflation caused by the energy crisis fueled by the terrible war in Ukraine”. “I know that the first victims of inflation are the disenfranchised, the powerless, and women.” That is why “we must and will do what is required and restore price stability. And we will do whatever is required.” This was stated by the President of the European Central Bank, Christine Lagarde, in a discussion dedicated to International Women’s Day with the Director-General of the World Trade Organization, Ngozi Okonjo-Iweala.

EU stock markets are improving but remain cautious

European stock markets are improving but treading cautiously and mixed. In Frankfurt, the Dax is down +0.06%, in London, the Ftse 100 is down by 0.26%, in Paris, the Cac 40 is down by 0.22%, and in Madrid the Ibex-35 is up by 0.19%. Milan rose with Ftse Mib at +0.21%.

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Eurozone, GDP stable in Q4 2022. Employment +2.2% last year

Eurozone GDP remained stable in the fourth quarter of 2022, while it decreased by 0.1% in the European Union compared to the previous quarter. This was revealed by Eurostat, the European Union’s statistical office. In the third quarter of 2022, GDP grew by 0.4% in the euro area and the European Union. The Census Bureau also released data on employment. In the fourth quarter of 2022, employment in the euro area and the European Union grew by 0.3%. Compared to the same quarter of the previous year, employment increased by 1.5% in the euro area and by 1.3% in the EU in the fourth quarter of 2022, after +1.8% in the region and +1.5% in the EU in the third quarter of 2022. According to For the first estimate of annual growth for 2022, based on quarterly data, employment increased by 2.2% in the euro area and 2.0% in the European Union.

Milan up a little. Fincantieri suffers

After a declining start, the Milan Stock Exchange turned slightly higher. And in Avary Square, the Ftse Mib rose 0.17% to 27,808 points. Fincantieri saw a sharp decline in the wake of the 2022 accounts. Shares lost 5.7%, to settle at €0.55. Equita analysts set the 2022 numbers as lower than expected. The forecast for 2023 was also disappointing. They explained that “guidance at the operating level expects EBITDA to be approximately 370 million, which is approximately 20% lower than our current estimates,” noting also that the index also indicates indications of financial leverage for adjusted earnings according to debts that exceed six times as much. Experts have issued a ‘comment’ with a target price of €0.49. Intermonte also issued an “Underperform” rating with a price target of €0.45.

FISCO vs. Hawks: “I don’t appreciate prolonged rate hike comments.” Montale states

“Uncertainty is so high that we as the ECB Governing Council have agreed to take a ‘meeting by meeting’ decision, with no ‘forward guidance’. So I don’t appreciate my colleagues’ comments about future and extended rate hikes. I know, we don’t know enough; that’s why I can only say, recalling Eugenio Montale, “what we are not, what we do not want, in this case high and prolonged inflation.” This is confirmed by the Governor of the Bank of Italy, Ignazio Fiesco, in his welcoming address to the XIV Congress Maeci – Bank of Italy.

FISCO to the ECB: continue to tread carefully

“Even if monetary policy has so far succeeded in anchoring expectations, the grave geopolitical situation makes it very difficult to forecast future macroeconomic trends. Thus, monetary policy has to continue to move cautiously, guided by the data that gradually becomes available, in order to Returning inflation to the 2 percent target in the medium term, without jeopardizing financial stability and minimizing the negative effects on the still fragile recovery. This was confirmed by the Governor of the Bank of Italy, Ignazio Fiesco, during his welcome speech at the XIV Maeci – Bank of Italy Conference with delegates and financial operators accredited abroad. “However, it will be necessary to prevent the supply shock, made more persistent by the dramatic conflict in Ukraine than initially anticipated, from causing inconsistent increases in labor costs and profit margins in the eurozone as a whole sufficient to preclude a rapid return to the objective of price stability,” he added. fisco.

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European stock exchanges are waiting for Lagarde and Powell

European stock exchanges are open awaiting Jerome Powell’s hearing today in the Chamber and Christine Lagarde’s speech in Geneva, at the World Trade Organization, in light of the meeting on March 16. Central banks are becoming increasingly aggressive with the aim of fighting inflation. In Frankfurt the Dax index fell by 0.19% to 15,529.55 points, in London the FTSE 100 index fell by 0.23% to 7,901.66 points, the Cac 40 index in Paris lost 0.37% to 7,312.16 points, and in Madrid the Ibex-35 index fell by 0.26%, at 9,386.18 points. Milan was also negative with the Ftse Mib registering -0.30%.

Germany, a leap in industrial production

A jump in Germany’s industrial production: in January, it rose 3.5% month-on-month from -2.4% previously. The figure is also clearly better than the forecast of +1.4%. Instead, retail sales posted a decline of 0.3% qoq in January and 6.9% yoy.

Uncertain stock exchanges in Asia

Equity markets in Asia Pacific headed lower after Federal Reserve Chairman Jerome Powell warned that interest rates may rise more than expected, and a second speech is scheduled today. Particularly bad is Hong Kong, closing by more than two percentage points also due to rising tensions between China and the United States. Seoul closed down 1.2% and Sydney closed down 0.7%. Chinese stock markets were flat, and the Tokyo index was slightly higher (Nikkei 225 +0.4%). Futures to launch European listings uncertain.

Tokyo managed to close higher

The Tokyo Stock Exchange closed the session at its highest level in six months, despite the contraction of the US stock market, supported by the weakness of the yen against the dollar and expectations of a recovery in tourism in Japan. The Nikkei index rose 0.48% to 28444.19, up 135 points. In the foreign exchange market, the yen is trading at its lowest in two and a half months against the dollar at 137.60, and against the euro at a level just above 145.