Bags, thud of the Asian markets were also weak European markets – BBC

MARKET

Milan , January 26, 2016 – 08:28

The good opening on Wall Street, with the Dow Jones Industrial rising 0.91% at the opening, the S & amp; P500 on 0.45% of the Nasdaq + 0.41% pushes up even the European markets, substantially flat mid-session. Milan was the best Square with the FTSE Mib index rising 1.05. Particularly reactive bank stocks with Ubi Banca up by 7.38%, Banco Popolare up 4.7%, 3.6% and Mediobanca Banca Popolar Emilia Romagna up 3.32%. Well, among the industrial, Fca, second best title of the list with an increase of + 5.22%.

The morning was marked by a new heavy thud of the Asian markets closed with sharp decline in the Tokyo Stock Exchange and the collapse of Shanghai. The Nikkei index had lost 2.35% and left on the ground at an altitude of 402.01 points 16,708.90 and Shanghai was turned down 6.4% due to the climate of general panic. Dramatic drop for the Shenzhen Stock Exchange, the second largest in China, with the index component that falls to 9,483.55 points at -6.96%. The performance in Tokyo was affected by the negative performance of Wall Street and the new fall in oil prices, the share fell below 30 dollars a barrel. The China syndrome it seems, however, has not spread to the rest of the lists remained a global phenomenon confined within the region.

Cash

The new splash of Asia comes despite liquidity injections of central bank of China (PBOC) in view of the festivities for the New Year moon that will begin in early February. The PBOC has decided to enter 440 billion yuan (the equivalent of about 62 billion EUR) in the financial system to meet the increased need for cash that usually occur before the Chinese New Year. In addition, for the occasion, companies pay salaries and annual bonuses to employees, factors that affect the liquidity crisis. But the new injection of capital did not stop the stock market crash of Asia-Pacific, which is brought back even the European markets with the opening in Paris of negative (-1.5%, before returning to positive +0 , 08%) and the Milan Stock Exchange. Shortly after the mid-day mark but European stocks were brought on equality. Milan remains largely the better and grow with the FTSE Mib 1% mainly due to purchases of banks. Yield instead MPS (-3.5%) and Saipem (-6%).

The causes of the collapse

But why have collapsed even Asian markets? Because of the oil back down to below $ 30? Or they dropped because it is the economic slowdown in the Far East to slide the crude? It’s one of the questions of today and an important response came from the opening of the back Business & amp; Tech Wall Street Journal , which explains that China, the world’s first buyer of oil, no longer so thirsty (Bends Oil Outlook to Not-So-Thirsty-China) of black gold. The oil giant Exxon, in fact, announced a few hours ago had cut sharply sales expectations in China. By reducing the energy demand forecast for the country dramatically to 2.2% per year between now and 2025. Calculated over a decade, he writes the Wall Street Journal , equivalent to a volume of crude oil more than annual consumption of Brazil. Exxon argues in his analysis that the demand will start to recover by 2030. And today investors are concerned in Asia from stocks still, the resulting oil prices back near multi-year lows and a sharp slowdown in China. Add to this the plan of the Federal Reserve to raise interest rates up to four times in 2016. That would encourage capital flight from Asia to the United States. To make matters worse, that Iraq continues to export oil in a sustained manner, Saudi Arabia that between affirmation and a denial of the fact continues to pump and not to withdraw from politics in market shares, and data on US stocks of shale increases (+3.5 million barrels last week, according to Platts).

26 January 2016 (modified January 26, 2016 | 16:07)

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