Today’s Stock Exchanges, March 7th. Flat start waiting for Powell (Fed). Traders fear he will have to hike rates more than expected
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Cautious departure of the markets, waiting for the words of Jerome Powell in the Senate: his semi-annual testimony comes at a crucial time, with investors waiting to understand what the prospects for rate hikes by the US central bank to fight inflation are, and what repercussions they will have on all asset classes and the moves of the other central banks starting with the ECB. The expectation is that Powell supports the argument that interest rates will need to rise more than forecasted just a few weeks ago if the data continues to show a strong economy. According to Unicredit analysts, the governor has the opportunity to clarify market expectations in view of the Fomc of 21-22 March: specialists fear that the chances of a reacceleration of the pace of monetary tightening are high, in the light of an economy very strong American. Already now, traders are betting that the Fed will raise rates beyond the 5.1% estimated by central bank members in December. Moreover, various data on the labor market are also expected during the week, which will give further indications on the next steps of the US central bank.
Cautious departure from EU price lists
Stock markets are cautiously waiting for Powell: after a weak opening, the European stock markets are now slightly up. The best price lists are those of Madrid and Frankfurt, respectively at +0.17% and +0.16%. London rose by 0.08%, Paris by 0.07% and Milan by 0.06%.
Germany, factory orders beyond estimates: +1% in January
German factory orders remained above estimates in January. Against an expected decrease of 0.9%, the balance was positive for 1%, against a previous increase of 3.4%.
Nexi, revenues up 7.1% to 3.26 billion. Profit +16.5%
Nexi closed 2022 with revenues up 7.1% to 3.26 billion euros. EBITDA increased by 14.2% to 1.61 billion. The pre-tax profit rose by 16.5% to 1.01 billion and the net profit pertaining to it by 15.1% to 693.2 million. The group’s estimates for 2023 are confirmed, with revenues growing by “over 7%”, EBITDA by more than 10% with excess cash of “at least 600 million” and normalized earnings per share up by “over 10%”, also due to the long-term agreement signed on 27 February with Banco Sabadell. “2022 – commented the CEO Paolo Bertoluzzo – confirmed another year of solid and profitable growth in all our businesses and in the various geographical areas, recording an exceptional evolution in margins and an acceleration in the generation of cash flow, despite the complex macroeconomic situation”.
Tokyo Stock Exchange climbs 0.25%
Tokyo stocks closed higher, while falling US long-term Treasury yields buoyed investor sentiment. However, uncertainty ahead of Fed Chairman Jerome Powell’s congressional testimony later in the day, Friday’s pivotal US jobs report, and Bank of Japan Governor Haruhiko Kuroda’s final rate decision ahead of his retirement they held back gains. The Nikkei finished up 0.25% at 28,309.16 points, after hitting an early session high of 28,398.27, a level last seen on December 1st. The Topix gained 0.42% to close at 2,044.98 points, after hitting 2,046.11, its highest level since November 2021.
China, the 2-month surplus rises to 117 billion
China posted a trade surplus of $116.88 billion in January-February 2023, up from $109.7 billion in the same period of 2022, beating analyst estimates by $81.8 billion. Exports, down for the fourth consecutive month due to weak external demand, dropped by 6.8% (to 506.3 billion), however less than the expected -9.4% and -9.9% in December 2022. According to data from Chinese Customs, imports show a slowdown of 10.2%, to 389.42 billion, almost doubling the -5.5% expected and against -7.5% in December.
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