On one side tensions in the Middle East which are causing the price of oil and gas to soar again. On the other hand, the sales in tech stocks triggered today by the collapse of Sk Hynix and the resulting slump in Seoul's Kospi. These are the two drivers of the day, with European stock markets trying to navigate the two throughout the day and ultimately resisting the sell-off, while Wall Street is giving up in anticipation of earnings season.
Tensions in the Middle East
The situation in the Middle East remains tense, although investors continue to hope that the cross-fire between the United States and Iran will not permanently compromise diplomatic channels. However, the situation in the Middle East remains a cause for concern. Strait of Hormuz where traffic is severely reduced. "The United States, from now on, will be 'the guardian of the Strait.' For this reason, they will be reimbursed 20% of the value of all ships passing through it," US President Donald Trump stated in the early afternoon, immediately receiving Iran's response: "We will not allow the United States to intervene in the management of the Strait," Tehran's Joint Military Command stated.
The repercussions of the new escalation of tension are already visible on the raw materials market: oil prices are rising Petroleum, with Brent crude advancing 3,5% above $78 a barrel and Texas WTI rising 3,9% to $74,19. Oil prices are soaring gas, which in Amsterdam are above 51 euros per megawatt hour (+5,8%).
Europe holds firm, Wall Street is down
After a day of ups and downs Paris closes up 0,3%, while Amsterdam is growing by 0,1%. Frankfurt archives the session in a draw, as well as London where the title stands out Vodafone, up 5% after the French billionaire Xavier Niel entered its capital. However, it fell Madrid, which at the end of the day fell by 0,3%. In this context Milan is the best, with the Ftse Mib closing up 0,37% at 52.809 points. Overseas, Wall Street is in the red: the Dow Jones is down 0,2%, the S & P 500 by 0,35%, the Nasdaq loses 0,82%
" closure of the Strait “The risk-off sentiment will loom large over the market,” wrote Ben Emons, founder of Fed Watch Advisors. “However, unless a serious shutdown looms in the coming months, which could cause severe global energy shortages… attention will also be on the consumer price index (CPI), WASH, and bank earnings.” The data oninflation is expected tomorrow, the day in which the Fed chairman Kevin Warsh will hold a hearing in Congress. Meanwhile, anticipation is building for the quarterly season. Major U.S. banks, including JP Morgan, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup, and Wells Fargo, are among the 28 S&P 500 companies that will release their quarterly results this week starting tomorrow. Quarterly results from Netflix, Johnson & Johnson, and UnitedHealth are also expected. Expectations for the season are high: on average, analysts estimate that S&P 500 companies' earnings in the second quarter grew more than 23% year-over-year, according to FactSet.
Global tech stocks plunge after SK Hynix collapse
Sell-off in tech stocks, in deep red practically everywhere, while questions are growing about valuations, supported by the prospects of artificial intelligence, but challenged by the scale of investments announced for the development of the necessary infrastructure.
Let's start from Europe: in Germany Infineon drops 2,9%, while in Holland Asml It is down 1,8%. In Italy Prysmian is down 1,26%. The company is linked to the sector due to its role in electrification and data centers. Also down stm, which loses 0,76%.
Things are much worse on Wall Street where semiconductor stocks are under pressure due to Sk Hynix: The South Korean giant lost more than 14% in Seoul, recording its worst session and weighing down the Kospi (-8,95%). On the Nasdaq, where the stock debuted on Friday, gaining 13%, SK Hynix shares are down 6,5% today.
Sales also hit micron Technology (-4,2%), Intel (-4,4%), Sandisk (-8,47%), SeagateTechnology (-4%) And Amd (-1,4%).
Eni and Stellantis are doing well in Milan, while banks are doing well.
Returning to Milan, at the top of the main price list there is Eni, which rose 3,88%, driven by rising crude oil prices. After a volatile session, it closed higher (+2,56%). Inwit despite rumours that the Milan court has rejected the request for suspension presented by the company regarding the withdrawal of the MSA by Tim (+ 0,4%).
Positive (+2,4%) BRUNELLO CUCINELLI, tonic Stellantis (+1,99%) which released estimates for global consolidated deliveries in the second quarter, expected to grow by 10%, with a limited increase of 5% in Europe and a 38% surge in North America.
Buying in the banking sector: the best stock is Finecobank (+1,8%) following rumours of a potential rekindling of Unicredit (-0,5%). On the rise Ps (+ 1,28%) and Mediobanca (+1,18%). Siena CEO Luigi Lovaglio said that the potential of the Sienese institution is greater than that currently reflected by the stock market, adding that management has the duty to also evaluate possible alternative offers – to that of Understanding (+1%) – in the interests of the bank and the shareholders.
On the sales front, in addition to Stm and Prysmian, Defence stocks are falling, with Leonardo which gives up 1,3% and Avio down 1,2%.
The other markets
On the currency market, the euro is stable around 1,14 dollars, while on the secondary market, the spread between BTPs and Bunds closed up at 76 basis points from 75 last Friday. The BTp yield 10-year benchmark which last marked a 3,86% gain, from the previous benchmark's 3,80%.
