It was a dramatic start to the week for the stock exchanges. Today, all equity markets plunged after Friday’s heavy fall in European stock exchanges and in particular on Wall Street.
Obviously, the session was also heavy for our market and for the stocks of a well-known industrial group. Today, in fact, it was a very black Monday for the Italian stock exchange which collapsed and in Piazza Affari, these stocks collapsed and traders sell with both hands.
The two causes of the sharp decline
Tensions between Ukraine and Russia triggered a shower of opening sell-offs on European equity markets. The invitation by the United States and the United Kingdom to the families of diplomats to return to their respective countries has fueled the hypothesis of an imminent conflict.
This news penalized the European equity markets, but paradoxically not the Asian ones. It is worth noting that the Tokyo Stock Exchange closed 0.2% higher. Some Chinese equity indices also closed on positive ground.
This news has worsened an already very critical equity market climate. Wall Street closed heavily on Friday night after European stock exchanges ended the session with dips close to 2%.
The increase in government bond yields is another factor that has weighed on the stock exchanges. The yield of the 10-year American last week came in at 1.9%. Traders fear that the increase in interest rates by the end of the year will exceed 1%.
The meeting of the FOMC, the operational arm of the Fed’s monetary policy, will begin tomorrow and will end on Wednesday evening. The Fed’s decision on interest rates will be announced on Wednesday at 20 in Europe. Traders expect rates to remain unchanged. But the meeting could give indications on the possible moves of the US Central Bank in the coming months.
Black Monday for the collapsing Italian stock exchange and these stocks are sinking in Piazza Affari
At the end of the session, the main European stock exchanges closed with drops close to 4%. The Euro Stoxx 50 index lost 4.1% and the German stock exchange 3.8%. The Paris stock exchange lost nearly 4% while London limited the damage to a decline of 2.6%. At the time of the closing of the markets in Europe, the Wall Street indices were also in deep decline.
It should be noted that once again the Nasdaq is the index with the greatest decline. Around 6 pm in Europe the technology index was losing 3.6%, against 2.4% for the Dow Jones and 3% for the S&P 500 index.
Piazza Affari also had a loss similar to that of the European lists. At the end of the session, the Ftse Mib index (INDEX:FTSEMIB) plummeted 4% and prices finished at 25,972 points. The index took back all the gains made between December 20 and January 5.
Among the blue chips, no stock closed in positive. The four worst actions belong to the Fiat galaxy. Stellantis and Iveco lost over 7% CNH and Exor over 6%. The biggest decline in these stocks is likely to be explained by the fact that traders sold off the stocks they had earned the most in the past month. The best stocks among the blue chips were 2 utilities, Italgas and Hera with drops of around 1.4%.
Deepening
The point about the markets
