Falling stock markets feel the blow from Fed minutes

(Alliance News) - On Thursday, major European stock exchanges open in negative territory and feel the blow caused by the release of the U.S. Fed minutes last night, which come with the prospect that rates may remain higher for much longer.

Thus, the FTSE Mib is down 0.5 percent to 28,021.75, the Mid-Cap gives up 0.6 percent to 41,784.15, the Small-Cap is in the green 0.3 percent to 26,924.91, while Italy Growth gives up 0.4 percent to 8,895.18.

In Europe, Paris' CAC 40 is down 0.2 percent, as is Frankfurt's DAX, while London's FTSE 100 is in the red by 0.1 percent.

"While European markets have struggled to find direction this week with a slight downtrend, the FTSE100 is on track to record its worst weekly decline in over a month. U.S. markets came under further pressure in the wake of the release of the latest Fed minutes, falling to one-month lows," commented Michael Hewson, chief market analyst at CMC Markets.

"The slide following the minutes and the prospect that rates may remain higher for longer translates into another weak open for Europe, with Asian markets feeling the pressure from concerns about the outlook for the Chinese economy. The minutes turned out to be reasonably hawkish, which is not entirely surprising given the recent comments of various Fed officials, however, it did come as some surprise that only two members were in favor of keeping rates unchanged."

"Despite the recent hawkish rhetoric from various Fed officials, markets had grown accustomed to the idea that the July rate hike would likely be the last. Last night's minutes called that assumption into question, even as several Fed officials pointed out that the risks associated with monetary policy are becoming twofold, with some concern about how far the central bank can go when it comes to further rate hikes."

On the main index of Piazza Affari, no stocks are seen on the bullish front. Nexi does worst of all and sits at the bottom, down 2.2 percent.

Also at a loss, Prysmian, Interpump, and Iveco Group give up 2.0%, 1.7%, and 1.4%, respectively:

Tenaris loses 0.4 percent despite announcing that it has entered into a definitive agreement to acquire from Mattr 100 percent of the shares of its subsidiary Bredero Shaw International, which holds control of the pipe coating business worth USD166 million including working capital, on a cash-free and debt-free basis, subject to customary price adjustments.

Also at the back of the pack was CNH Industrial, in the red by 0.5 percent, marking a negative balance for the fifth session in a row.

On the Mid-Cap, Juventus Football Club - in the red by 0.4 percent - announced on Wednesday that it had reached an agreement with Società Sportiva Lazio, down 0.5 percent on the Small, for the sale, temporarily free of charge until June 30, 2025, of the rights to the sports performance of the player Nicolò Rovella.

The agreed consideration for the outright acquisition is EUR17 million, payable in three fiscal years.

At the bottom is Reply, down 2.9 percent, preceded by MutuiOnline, which gives up 2.7 percent and also closed among the bearish on Wednesday.

Among the few stocks on the upside are Ascopiave, which gains 2.1 percent, GVS, which gains 1.4 percent, and Piaggio, which rises 0.3 percent.

On the Small-Cap segment, Autostrade Meridionali gives up 0.3 percent. The company said Friday that, with reference to the recent performance of its stock on the stock market, it is not aware of any elements that could justify the upward changes that have occurred on the stock market since the end of July.

Servizi Italia - down 2.2 percent - reported Thursday that it ended the first half of the year with revenues and profits up compared to the same period last year.

The company's revenues increased to EUR143.8 million from EUR134.0 million in the first half of 2022. Revenues from washroom services-which in absolute terms accounted for 74.9 percent of the group's revenues-increased to EUR107.7 million from EUR101.8 million in the first six months of 2022, supported by robust growth in washroom Italy.

Among SMEs, Ecosuntek still does not trade. The company on Monday pre-cleared that its subsidiary Eco Trade "is already equipped with the necessary own resources to acquire the approximately 45 percent stake in +Energia Spa.

Before the closing, however, Eco Trade may consider the possibility of using a specific transaction with the banking system that takes into account a proper Debt/Equity ratio.

Vantea SMART - in the red by 0.8 percent - signaled Friday that it has initiated a new buyback plan.

Comal is not yet affected by trading. The company let it know Friday that it has notified Integrae SIM that it is exercising its right to terminate its Euronext Growth Advisor and specialist contracts.

In Asia, the Nikkei closed in the red 0.4 percent at 31,626.00, the Hang Seng was in fractional green at 18,336.79, and the Shanghai Composite closed in the green 0.4 percent at 3,163.74.

In New York on Wednesday, the Dow Jones closed down 0.5 percent at 34,765.74, the S&P gave up 0.8 percent to 4,404.33, while the Nasdaq left the parter 1.2 percent at 13,474.63.

Among currencies, the euro changed hands at USD1.0880 versus USD1.0905 in Wednesday's closing European equities while the pound was worth USD1.2724 from USD1.2751 on Wednesday evening.

Among commodities, Brent crude is worth USD83.89 per barrel versus USD85.04 per barrel at Wednesday night's close. Gold, meanwhile, trades at USD1,925.45 an ounce from USD1,903.08 an ounce on Wednesday evening.

Thursday's economic calendar includes, at 1100 CEST, the Eurozone trade balance.

At 1430 CEST, from the US, focus on the unemployment claims data while, at 1730 CEST, the 4- and 8-week Treasury bond auctions are scheduled.

Among companies in the Piazza Affari, no particular announcements are expected.

By Claudia Cavaliere, Alliance News reporter

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