MILAN – A very heavy start to the week on the markets. Negative indications coming particularly from the United States scare Asian stock exchanges, with the Nikkei losing 12.4%, marking the worst drop since the market crash of “Black Monday” on October 19, 1987. Other Asian indices suffer as well, albeit to a lesser extent, with Hong Kong faring the worst.
The atmosphere of fear also spreads to Europe, with all indices of the old continent in sharp decline and Milan losing nearly 4% in early trading, weighed down by banks. Wall Street also takes a hit and opens significantly down; however, the service PMI turned out to be better than expected after last week’s manufacturing data, which was in sharp contraction, triggered market concerns. Cryptocurrencies are also in the red, with Bitcoin dropping below 55,000 dollars. By the end of the day, Europe closes in the red, but Milan – which burns 15 billion euros – is the worst performer.
Wall Street has its worst session since 2022. Nasdaq -3.38%
Wall Street closes today in significant decline, although far from intraday lows, with the Dow Jones losing 2.60% to 38,703 points (1,034 points in a single session). The Nasdaq performed even worse, down 3.38% to 16,208 points, while the S&P 500 retreated by 2.93% to 5,190 points. The “magnificent seven” – Apple, Tesla, Alphabet, Amazon, Meta, Nvidia, Microsoft – have alone lost 800 billion in market capitalization.
Milan burns another 15 billion euros
On the main list of Piazza Affari, another 15 billion euros in market capitalization were burned today, bringing the total losses recorded by the Milan stock exchange to nearly 55 billion euros in three sessions. All stocks on Piazza Affari are in the red. The worst performer is Nexi, which drops 6.05% to 5.152 euros per share. Energy stocks also perform poorly, with Erg down 4.77%, Saipem at -4.41%, and Snam at -3.81%. Among the worst performers are Hera (-4.01%) and Stmicroelectronics (-3.93%). Banks are also down: Mps loses 3.15%, Mediolanum 2.84%, and Unicredit -2.54%.
Wall Street: session continues to decline sharply (S&P -2.1%) but indices are far from their lows
The black day continues on Wall Street. Like almost all major indices, US indices show a sharply negative performance, although they have recovered from the day’s lows. The investors’ worries about a slowdown in the US economy follow a series of disappointing macroeconomic data published last week. However, today’s services data in the US eased these fears, exceeding analysts’ expectations.
European stocks close in red
European stock markets close sharply lower after the crash of the Asian markets, with the Nikkei closing with a record loss of -12.4%, and after the negative opening of Wall Street, propelled by the negative performances of technology stocks. Concerns about the American economy and strong geopolitical tensions would also weigh on the markets.
The Dax in Frankfurt closes at -1.73%. In London, the FTSE 100 gives 2.05%, while the CAC in Paris loses 1.61%. Piazza Affari (the worst) sheds 2.26%.
Milan closes sharply down
A heavy closing for Piazza Affari on the black Monday of global stock markets. The Milan list closed down 2.27% at 31,293 points, containing declines in the afternoon after having lost up to 4.3% in the morning.
Euro closes up against the dollar at 1.0971
The euro closes up against the dollar (+0.57%), following new recession fears in the US supported by some macro data. The common currency is traded at 1.0971 against the greenback, gaining against the pound (+0.80%) at 0.8596 while dropping nearly two points against the yen at 157.15. Dollar/yen exchange rate sees the greenback significantly down (-2.20%) at 143.31.
Spread between BTP and German Bund closes at 152 basis points
The spread between BTP and German Bund closes at 152 basis points, down from 154 at the opening. The yield on the Italian ten-year bond stands at 3.67%.
Wall Street reduces losses, DJ -2.4%, Nasdaq -2.6%
Wall Street remains in red but all three indices have now reduced losses to less than 3%. The Dow Jones is down 2.37% to 38,794.37 points, the Nasdaq has risen to -2.59% to 16,342.09 points, while the S&P 500 is down -2.42% to 5216.96 points.
US services PMI better than expected
The US services sector returns to an expansion phase in July. The ISM purchasing managers’ index (PMI) records a level of 51.4, above the 50 threshold that separates an expansion phase from a contraction in economic activity. In June, the index had fallen to 48.4 after experiencing its worst setback in four years. The July rebound, exceeding economists’ expectations (51), may help alleviate fears about the state of the US economy triggered by Friday’s labor market data.
Wall Street plunges at opening
Wall Street opens with a plunge. The Dow Jones loses 2.76% to 38,640.33 points, the Nasdaq collapses by 6.05% to 15,760.02 points, while the S&P 500 drops 4.16% to 5124.25 points.
Goolsbee (Fed): “Ready to intervene”
If the American economy were to deteriorate, the Fed will intervene: said the president of the Chicago Fed, Austan Goolsbee, in an interview with CNBC. According to what Bloomberg reports, for Goolsbee the employment data “does not yet indicate a recession,” it is only “a number,” but in any case, the Fed “must pay attention” to the weakness of the labor market. The president also stated that “it would not make sense to maintain a restrictive policy if the economy were weakening.”
Anima, collection in July at 973 million
The net collection of managed savings of the Anima group in July 2024 was positive for 973 million euros, bringing the total assets managed to 201.7 billion euros.
“The July figure represents an extraordinary combination of excellent retail collection, which continues and improves on the trend seen in the first half, with the launch of two new pension mandates, the result of constant work whose results are concentrated in just one month, as is typical of the institutional business,” comments Anima Holding CEO Alessandro Melzi d’Eril. “The month – he continues – also sees a positive contribution from Castello and Kairos that exceeds the group average, in line with the strategic goals communicated to the market.”
Bets on emergency Fed rate cut increase
The market sees bets for an emergency Fed intervention on rates. Amid the turbulence and fears of an American recession in the morning, traders priced in a 60% probability of a 25 basis point rate cut within a week, a position that has been scaled back to 30% during the session. However, there is widespread belief in the market that the Fed will have to act quickly and decisively: traders expect a 50 basis point cut in September and another 50 in November, Bloomberg reports.
Wall Street, futures sharply down
Sharp drop in futures on Wall Street amid fears for the American economy that have also led to the crash of Asian markets. Before opening, Nasdaq futures lead the decline, with a loss around 4.8%. Dow Jones futures are down 2.32%, while S&P 500 futures are around a -3.4%.
In individual stocks, Apple plummets 7.6% after Warren Buffett’s Berkshire Hathaway announced last Saturday that it had halved its stake in the apple company, reducing it by over 50 billion dollars. Nvidia performs even worse, down 10% after news of a delay in the launch of artificial intelligence chips due to design flaws.
Among tech stocks, Intel records a -4.9% in pre-market after failing to post gains in the second quarter and announcing a suspension for over 15% of its employees. Coinbase lost 15% due to the crisis facing cryptocurrencies, as Bitcoin dropped over 15%. Crowdstrike is down 6.8% despite denying Delta Airlines’ accusations of causing the cancellation of thousands of flights.
In the automotive sector, Tesla shares are down 7.9%. Among pharmaceuticals, BioNTech drops 3.2% due to second-quarter revenues below estimates. Moderna is also in red, recording -5.3%.
Goldman Sachs raises recession odds from 15% to 25%, but risk remains limited
Goldman Sachs economists have increased the probability of a recession in the United States over the next year from 15% to 25%. At the same time, they emphasized that there are “several reasons not to fear a crisis.” “We continue to see the risk of recession as limited. The economy still looks good overall – they explain in a report to clients – there are no major financial imbalances, and the Federal Reserve has plenty of room to cut interest rates and can do so quickly if necessary”.
Oil at six-month lows, fears for US economy
Oil prices are at levels not seen in six months as markets fear a recession in the American economy. Around noon, Brent crude for September delivery lost 1.99% to 75.25 dollars.
Amsterdam Stock Exchange: +9% Oci
Oci soars on the Amsterdam stock exchange after announcing the sale of activities in the US for 2.35 billion dollars. The shares of the chemical group specialized in nitrogen, methanol, hydrogen, and fertilizers show a 9% increase to 23.61 euros by around 13:00.
OECD inflation at its lowest since 2021
Annual inflation in the OECD area decreased to 5.6% in June from 5.9% in May. This is the lowest level since October 2021. Several times since the beginning of the year, it had reached 5.7%. The international organization based in Paris reported this.
Year-on-year inflation fell in 24 of the 38 OECD countries and was below 2% in nine countries in June, compared to six countries in May. Inflation remained above 5% in Colombia and Iceland and exceeded 70% in Turkey. Inflation in the OECD area, excluding Turkey, stood at 2.9% in June after +3.1% in May. Regarding energy prices, they fell to +2.3% in the OECD area in June after +2.5% in May. Inflation in the food sector remained stable at +4.7% after +4.8% in May.
In the euro area, annual inflation remained stable at +2.5% in June after +2.6% in May. In the G20, inflation slowed to +7% from +7.3% in May. In G7 countries, inflation stands at +2.7% after +2.9% in May, reaching its lowest level since March 2021.
Europe remains weak, Milan -3%
Stock markets in the Old Continent look at the halfway point of the day still in sharp decline: the worst performing markets are those of Milan and Amsterdam, which hover around a loss of 3%, followed by Frankfurt that gives up nearly two and a half percentage points.
The atmosphere remains very nervous and volatile, especially with recession fears, with London down 2.2% and Paris moving to a loss exceeding two points. The wait is for the start of Wall Street’s week, with the government bond market partially stabilizing and the spread between Italian and German 10-year bonds at around 150 basis points.
The euro is positive (+0.4%) against the dollar at 1.095. Among cryptocurrencies, Bitcoin, always very volatile, continues in its phase of weakness and drops 14% around 52,000 dollars.
On Piazza Affari, continuous sales on Nexi (-6%), with Stm down 5.6% and Saipem about five percentage points. Tim is down 4.5%, while Leonardo and A2A try to get closer to parity.
Italian services PMI falls more than expected
The Hcob services PMI index in Italy fell to 51.7 in July from 53.7 in June. Expectations were for a more contained decline to 53. Although 2024 has continued to record monthly growth so far, the last rise was the slowest and most modest in six months.
Milan collapses with the banks
It only takes a handful of trades for Milan to accelerate downward. After a bad start, with the Ftse Mib index retreating by nearly two percentage points, the main list of Piazza Affari now loses almost 4%, with banks showing heavy losses in a red list. Among the biggest declines are Bper and Mps.
Europe opens in red
A black Monday for the stock markets. Negative economic indications coming from the United States, along with new winds of war, scare the stock exchanges: in Tokyo, the Nikkei index loses 12.4%, marking the worst drop since October 19, 1987, and the lists of the Old Continent seem to follow the footsteps of Asian indices. In Milan, the Ftse Mib index loses 1.78% to 31,447 points, with the spread between BTP and Bund rising to 154 basis points. Frankfurt is also down -2.5%, London -2.18%, Paris -2.47%, and Madrid -2.88%. In Piazza Affari, sales hit every sector across the board. The worst performer is Leonardo, which yields 6.25%, in a red list with major declines noted for Prysmian -6.02%, Nexi -5.72%, and Banca Mediolanum which loses 5.63%.
The spread opens slightly moved
The spread between BTP and Bund opens slightly moved. The differential between the two government bonds starts the session at 153.8 points, compared to the last close of 154.4 points. The yield on the Italian ten-year is at 3.61 percent.
Nikkei plunges, -10%
Tokyo stocks collapsed over 10% in afternoon trading, weighed down by the resurgence of the yen and poor US employment data that fueled recession fears. The benchmark Nikkei 225 plummeted by 10.01% (3,595 points) to 32,314.40, while the broader Topix index lost 10.49% to 2,271.33. This is the largest one-day drop since the crash of 3,836 points, equivalent to 14.9%, on “Black Monday” in October 1987.
For the Nikkei, the worst day since 1987
Today is set to become the worst day for the Tokyo Stock Exchange since 1987. With little time before the closing, the Nikkei 225 is down up to 8.1%, a decline of 2,900 points. The worst performance of the index in a single day dates back to the black Monday of October 1987, when the Japanese stock exchange lost 14.9%.
Singapore drops 2.5% at opening
The Straits Times Index (STI) of the Singapore Stock Exchange opened today down 2.5% (85.57 points) to 3,295.88 following last Friday’s Wall Street crash.
China: court orders bankruptcy of 2 Evergrande subsidiaries
A Chinese court has ordered two subsidiaries of Evergrande Nev, the electric vehicle subsidiary of the real estate giant Evergrande, to enter a bankruptcy and reorganization process requested by their creditors. In a statement sent to the Hong Kong stock exchange today, the company indicates that the hearing took place last Friday. The decision affects Evergrande New Energy Vehicle (Guangdong) and Evergrande Smart Automotive (Guangdong). This decision, Evergrande Nev explains, “has an impact on the production and activities of the company and its subsidiaries.”
Exchanges: yen over 145 per dollar
The yen strengthens for the first time since January. The Japanese currency has surpassed 145 per dollar after the Bank of Japan raised interest rates last week.
Asian markets: Hong Kong opens in loss
The Hong Kong stock exchange plummeted at the reopening on Monday, in line with Wall Street and the rest of Asia following the US employment report that fuels fears of a recession in the world’s number one economy. The Hang Seng Index loses 1.59%, or 268.69 points, to 16,676.82.
Bitcoin drops 10%, falls below 55,000 dollars
Bitcoin, under pressure, drops 10% and falls below 55,000 dollars after what has been its worst week since the FTX crash. In the last three days, the cryptocurrency market has seen 313 billion dollars vaporized with the fall of stock markets. Bitcoin is currently priced at 54,333 dollars.
Futures on Wall Street sharply down Nasdaq -2.6%, S&P 500 -1.6%
Futures on Wall Street are sharply down, continuing the negative trend of recent sessions triggered by recession fears. Nasdaq futures, already in correction, are down 2.6%, while S&P 500 futures are retreating by 1.6%.
Tokyo Stock Exchange collapses over 7% after early trades
The Tokyo Stock Exchange collapses over 7% after the early trades on Monday, pressured by a rising yen and US employment data that fuels recession fears. The Nikkei 225 index loses 7.03%, or 2,523.23 points, to 33,386.47, while the Topix is down 7.49%, or 190.01 points, to 2,347.59.