Good banks and oil, Mib opens the year higher

(Alliance News) - Europe's major marketplaces closed the first trading day of 2024 slightly higher on Tuesday, with banks pushing up in Piazza Affari while Brent futures regained altitude amid fears that escalating geopolitical tensions in the Middle East could disrupt supply.

Indeed, over the weekend, U.S. Navy helicopters destroyed three Houthi boats whose crew had attempted to board a container ship in the Red Sea, killing several people.

Axel Rudolph, a market analyst at IG, said, "Rising yields as investors tempered their expectations of interest rate cuts this year and a 3.0 percent drop in Apple's stock following a broker downgrade were enough to send most major U.S. indexes lower on the first trading day of the year. Tesla beat estimates for fourth-quarter deliveries but electric vehicle maker Rivian missed quarterly delivery expectations, weighing on Elon Musk's company's stock."

Thus, the FTSE Mib closed Tuesday up 0.6 percent to 30,524.63, the Mid-Cap lost 0.5 percent to 44,336.03, the Small-Cap gave up 0.1 percent to 28,303.41, and Italy Growth rose 0.5 percent to 8,342.93.

In Europe, London's FTSE 100 closed down 0.2 percent as did Paris' CAC 40 while Frankfurt's DAX 40 rose 0.1 percent.

On the Mib, Enel closed in the red by 0.3 percent. On Friday, it announced that through its wholly owned subsidiary Enel Green Power Spa, it finalized the sale of 50 percent of Enel Green Power Hellas, EGP's wholly owned renewable subsidiary in Greece, to Macquarie Asset Management, acting through Macquarie Green Investment Group Renewable Energy Fund 2. Thus, EGP received total consideration of about EUR350 million, equivalent to an enterprise value, on a 100% basis, of about EUR980 million.

Banking stocks did well, with MPS closing up 6.1 percent, followed by BPER Banca and Unipol, up 3.6 percent and 2.6 percent, respectively.

"The feared increase in bank non-performing loans seems fairly averted," reasons a Milan banker exclusively for Alliance News, "and even with rates expected to fall, Italian banks should maintain a good intermediation margin for 2024.

Above all, major institutions have taken advantage of 2023 to reorganize many bancassurance agreements, improve advice at the counter, and generally gear up for an increase in commissions that can offset a foreseeable drop in rates.

The oil sector also did well, with Eni advancing 1.4 percent and Tenaris rising 1.0 percent while Saipem gained 1.2 percent.

On the Mid-Cap, Maire Tecnimont closed up 1.2 percent. It reported on Friday that following the award announced last June of a nitric acid and ammonium nitrate plant project by KIMA, Egyptian Chemical Industries Company received advance payment and authorization to start engineering work.

Notice to proceed for Engineering Procurement and Construction (EPC) activities is expected by the end of June 2024. The EPC contract was awarded to a consortium led by Tecnimont for a total value of USD300 million, of which Tecnimont is responsible for approximately USD220 million.

Technogym--up 0.7 percent--announced that it had purchased--in the period between Dec. 27 and Dec. 29--a total number of 41,000 treasury shares. The daily weighted average price amounted to EUR9.13 per share for a total value of approximately EUR375,000.

At the top is D'Amico, which closed up 3.2 percent.

MFE-MediaForEurope--A shares closed up 1.3 percent and B shares up 1.4 percent--reported Friday that 2023 was a record year for Mediaset ratings. As the company reports, "despite not being among its listening targets, Mediaset steadily surpasses its public competitor on all Italians considering the full year and all events. Auditel certifies this by recording the steady increase in the audience of Mediaset networks in all the main programming slots. A historic result." Class-A stocks opened in the green by 0.3 percent, while Class-B stocks marked a plus 1.7 percent.

On the Small-Cap, PLC -- up 9.1 percent -- on Tuesday announced that it had granted Hitachi Zosen Inova an exclusive until Jan. 31, 2024, to negotiate the purchase and sale of the entire stake -- equal to 51 percent of the entire share capital -- held by PLC in Schmack Biogas.

HZI submitted an offer that considers the value in terms of enterprise value referring to 100% of the share capital of Schmack Biogas S.r.l. and its subsidiaries to be more than EUR19 million, with a price adjustment mechanism, typical for this type of transaction.

CY4Gate - in the red by 0.1 percent - announced on Friday that it had signed two contracts for the supply of proprietary cybersecurity technologies, namely the product called "SENTRY," which is completely made by the company.

As the company explained in a note, the contracts, worth a total of about EUR1.3 million and for the duration of one year.

Among the SMEs, Lemon Sistemi, which was admitted to trading on December 29, closed up 50 percent at EUR2.94. The company specializes in the design, supply, and installation of photovoltaic, thermal-hydraulic, and storage systems and the design of energy efficiency solutions.

The total amount of the placement, which was entirely a capital increase, had amounted to about EUR2.0 million. Shares placed in the IPO totaled 1.3 million at a price set at EUR1.47 per share.

Circle--up 2.2 percent--on Tuesday reported that subsidiary Magellan Circle had been awarded the BlueBARGE project for powering ships. Funded by the Horizon Europe program, BlueBARGE will allocate EUR213,000 to Circle over 36 months and will end in December 2026.

Mevim - in the red by 1.2 percent - announced Friday that its board of directors has approved the sale of its entire shareholding constituting the entire share capital of MC Real Estate.

The public deed of sale in the form of an exchange of the shareholding is set at EUR490,000.00 and will be paid by the counterparty, Demofonte Srl, through the sale in favor of Mevim of the property whose total value amounts to EUR490,000.00.

Ulysses Biomed - down 0.3 percent - reported that, with regard to the reverse takeover transaction involving the company's acquisition of the entire share capital of Hyris, the board of directors proceeded to verify that no significant new facts affecting the value of Hyris and the independent expert RSM's valuation had occurred.

In New York, the Dow is up slightly to 37,704.46, the Nasdaq gives up 1.7 percent to 14,753.97 while the S&P 500 is in the red 0.7 percent to 4,735.68.

Among currencies, the euro changes hands at USD1.0944 against USD1.1054 recorded in Friday's European stock close while the pound is worth USD1.2624 from USD1.2738 on Friday evening.

Brent crude is worth USD77.41 per barrel versus USD77.64 per barrel at Friday's close. Gold, on the other hand, trades at USD2,058.07 an ounce from USD2,076.30 an ounce Friday night.

Wednesday's macroeconomic calendar includes at 0900 CET the Spanish unemployment rate and at 0955 CET the same figure for Germany.

In the afternoon, from the U.S. the 30-year mortgage rate at 1300 CET and at 1600 CET the ISM index of manufacturing purchasing managers and new jobs JOLTs for November.

In the stock market, no special events are expected.

By Chiara Bruschi, Alliance News reporter

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