FTSE MIB Roars in Italy as Benchmark Index Throws Off Referendum Gloom

Italy’s benchmark equities index, the FTSE MIB, has continued the rebound that started Monday afternoon to record an impressive return of 1.7% today. Prime Minister Matteo Renzi’s resignation has been accepted by President Sergio Mattarella but he has been persuaded to stay on for a few days until the country’s 2017 budget has been passed.

The banking sector has shown a particularly resilient bounce back with most of the index’s banking constituents doing well today, with the exception of embattled Banca Monte dei Paschi di Siena, down 3.75%.

Banca Mediolanum (+1.84%), Banco Popolare (+1.58%), Banca popolare dell'Emilia Romagna (+3.25%), FinecoBank (+3.19%), Intesa Sanpaolo (+4.36%), Mediobanca Banca (+6.13%), Banca Popolare di Milano (+1.62%), Unione di Banche Italiane (+4.66%) and, finally, Unicredit (+5.66%) are all showing significant gains.

Monte dei Paschi, which needs to raise 5 billion euro in recapitilisation funds appears to be running out of private sector options from which to do so, with Renzi’s referendum defeat shaking confidence in the country’s banks further. However, there are a number of other Italian banks in need of recapitilisation and despite today’s gains for the sector, 2017 may prove to be a trying year.

Elsewhere, electric utilities company A2A is having a very strong session to show gains of 4.59%, while electricity and gas distributor Enel is up 2.08%. Peers across European indices have been climbing strongly today. Natural gas infrastructure firm Snam has gained 2.5%.

Fallers are limited today but eyewear maker Luxottica Group is down 1.25%, fashion company Salvatore Ferragamo 0.53% and welded steel pipes and products company Tenaris 1.51%.

In Austria the ATX is up just under 1% with banks and financial sector companies also doing well. Raiffeisen has gained 4.11% and Erste Group Bank 2.35%. Vienna Insurance Group adds to a good Monday, up 1.65% and insurance peer UNIQA has also gained, though more modestly, by 0.39%.

Catering company Do & Co, which hasn’t been having the best of times of late, has a good return today, up 3.58%. Schoeller-Bleckmann Oilfield Equipment is up 2.55%, integrated oil company OMV 1.53% and Telekom Austria 2.13%.
Lighting company Zumtobel, however, is down over 7% today.

The company presented half-year figures showing a 5% drop on the same period last year. Negative currency effects and the revenue generated by a lighting advertising business sold last year were put forward by the company as the explanation for the drop in income. Textiles company Lenzing also slipped by 1.49% and electricity utility Verbund defied the gains for similar companies today to record a 1.28% loss for the day so far.

In Amsterdam, the AEX is up 0.4% with insurer ING leading the way, up 3.17%. Insurance peers Aegon and NN Group are also up 0.02% and 0.59% respectively. Bank ABN Amro is also having a good day and has added 2.27% to its share price.

Telecoms company Altice is up 1.96%. The company announced at the end of November that it would launch a super-fast broadband service in parts of the U.S. The five-year deployment schedule will begin in 2017. Digital security company Gemalto is up 2.44%.

The day’s only real fallers are pharmaceuticals research company Galapagos, down 1.61% and food and nutritional supplements company Koninklijke DSM.

And finally, to Stockholm, where the OMX 30 is flat, up by a fractional 0.09%. Digital security company Fingerprint Cards is again the day’s biggest faller, down 2.06%, followed by mining and smelting company Boliden with a loss of 1.25%. Medical technology company Getinge is the biggest gainer, up 2.6%, followed by Nokia, 1.7% and Ericsson 1.61%.