(Alliance News) - European indexes are expected to open higher on Thursday in the aftermath of yesterday's Fed announcements that proved to be "a relief" for the market, "where fears reigned that the U.S. central bank would become hawkish," as Ipek Ozkardeskaya, Senior Analyst at Swissquote Bank, commented.
"The probability of a rate cut in June spiked above 75 percent after the meeting, from about 60 percent on Monday," the analyst added. "The U.S. 2-year yield fell below 4.60 percent and the 10-year yield fell below 4.30 percent, the dollar index gave up last week's gains and returned to the February-March downtrend channel. The S&P500 crossed the 5200 mark while the Nasdaq jumped more than 1 percent after the Fed's dovish surprise."
In Europe, the mood was much less cheerful as the 11 percent collapse of Kering, the owner of Gucci, raised questions about the health of other European luxury stocks.
The FTSE Mib, therefore, is expected to rise 0.8 percent or 285.0 points after taking home a 0.1 percent gain to 34,293.29.
In Europe, London's FTSE 100 is up 0.8 percent or 62.0 points, Paris' CAC 40 is expected to be in the green by 0.9 percent or 72.7 points, while Frankfurt's DAX 40 is given up 1.0 percent or 187.2 points.
On the central banking front, European Central Bank chief Christine Lagarde did not charm Europeans by saying the ECB cannot commit to cutting rates beyond the first cut in June. She reiterated that "we will know a little bit more by April and a lot more by June."
Today it is the Bank of England's turn to announce its decisions. Yesterday's softer-than-expected inflation data and last week's softer-than-expected employment data are in favor of the BoE doves. If more MPC members vote in favor of a rate cut, expectations of a BoE rate cut are likely to be scaled back in early summer.
Among Italy's smaller listings on Wednesday, the Mid-Cap advanced 0.2 percent to 47,271.31, the Small-Cap rose 0.3 percent to 27,523.80, and Italy Growth gained 0.6 percent to 8,162.87.
On the Mib, Terna closed with bullish trend of 3.6 percent, better than the Mib with with new price at EUR7.84 per share. Goldman Sachs raised the target price to EUR7.95 from the previous EUR6.65. The company also reported that Moody's confirmed its 'Baa2' long-term rating on the company, with a Stable outlook.
Prysmian, on the other hand, closed up 1.4 percent at EUR49.41, in its third bullish session and with new 52-week high touched at EUR50.10.
Poste Italiane -- trailing down 3.9 percent -- unveiled its new strategic plan to 2026 on Wednesday, which calls for growth in investments and estimates rising revenues and profits over the plan's span. The dividend is expected to be no less than EUR1.00 from 2026 while revenues are expected at EUR13.5 billion in 2028, with average annual growth of 3 percent. Operating income is expected at EUR3.2 billion, with CAGR of 4%, and net income is expected at EUR2.3 billion at the end of the plan, with annual growth of 4%.
DiaSorin, on the other hand, gave up 3.0% with new price at EUR91.82 per share, closing the bluechip list after two sessions ended with bullish candle.
Eni closed down 1.6 percent to EUR14.32 per share, after a 2.4 percent green in the previous session. Worth mentioning, Beremberg cut its target price to EUR15.00 from EUR17.00.
On the cadet segment, Fincantieri advanced well, going up 7.5 percent to EUR0.6720 and updating during the session the annual high at EUR0.6750.
Fitch Ratings announced Wednesday that it had upgraded Acea's outlook -- which advanced 2.7 percent -- from Negative to Stable, confirming the long-term issuer default rating at 'BBB+.' In addition, the rating agency confirmed the short-term IDR at 'F2' and the long-term senior unsecured rating at 'BBB+'.
Saras, on the other hand, is priced bullish by 0.3 percent at EUR1.78, unchanged on the previous session. Of note, Barclays cut its target price on the stock to EUR1.75 from EUR1.70 per share.
On the small-cap, Seco rallied 5.0%. Earlier this week it reported that it ended 2023 with adjusted net income up to EUR22.9 million from EUR20.5 million in 2022.
B&C Speakers -- down 1.4 percent -- reported Tuesday that it ended 2023 with a total group profit of EUR13.9 million, up 13 percent from EUR12.3 million as of December 31, 2022. The company proposed to pay a dividend of EUR0.70 per share from EUR0.60 in 2022.
FILA -- in the red by 0.6 percent -- on Tuesday reported that it ended 2023 with consolidated revenues of EUR779.2 million from EUR764.6 million as of Dec. 31, 2022. Normalized net income in the period was EUR40.6 million from EUR42.8 million in 2022. The company said it has proposed to distribute a dividend of a maximum total amount of EUR6.1 million, confirming that of EUR0.12 per share in 2022.
Eurotech - double-digit bearish with 14 percent - reported that it ended 2023 with a net loss of EUR3.1 million compared to a loss of EUR1.6 million in 2022. Revenues fell to EUR93.8 million from EUR94.3 million while, at constant exchange rates, there would be a 3.6 percent year-on-year increase.
Among SMEs, Growens advanced 2.1 percent, rewarded by good 2023 accounts. The company finished last year with a net profit of EUR53.2 million, compared to the EUR2.5 million red booked in 2022, "as a result of the extraordinary divestment operations carried out in 2023."
Italian Wine Brands - in the green by 4.9 percent - announced Wednesday that it had concluded its share buyback program. Under the plan, the company bought back 30,000 of its own shares, paying an average of EUR17.58 each, for a total value of about EUR527,000.
For Eprcomunicazione, however, the red was 8.7 percent, subject to profit taking after two strongly bullish sessions.
In Asia, the Nikkei closed up 2.0 percent, the Hang Seng advanced 2.2 percent, and the Shanghai Composite finished just below par.
In New York, the Dow closed up 1.0%, the Nasdaq rose 1.3%, and the S&P 500 advanced 0.9%.
Among currencies, the euro changed hands at USD1.0940 against USD1.0857 recorded in Wednesday's European stock close while the pound was worth USD1.2802 from USD1.2717 on Wednesday evening.
Brent crude is worth USD86.44 per barrel versus USD85.78 per barrel at Wednesday's close. Gold, meanwhile, trades at USD2,207.92 an ounce from USD2,157.09 an ounce on Wednesday evening.
Thursday's macroeconomic calendar calls for Germany's manufacturing PMI at 0930 CET, followed at 1000 CET by the Eurozone current account balance and services PMI, the latter also coming thirty minutes later from the United Kingdom.
At 1300 CET, the Bank of England will release its interest rate decision.
At 1330 CET, from the U.S., there will be the report on unemployment claims, followed at 1445 CET by the manufacturing and services PMI.
At 1500 CET, there will be the release of the report on existing home sales.
In the evening, at 2130 CET, there will be the release of the Federal Reserve's weekly balance sheet.
On the corporate calendar, among numerous corporate results, those of Bellini Nautica, Enel, Gambero Rosso, Unipol, and UnipolSai are expected.
By Chiara Bruschi, Alliance News reporter
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