Stock exchanges, Trump's blitz triggers new records: Dow Jones above 49,000 pts. Milan closes +1%

(Il Sole 24 Ore Radiocor) - European stock exchanges began the week on an upward trend, despite the news in the last few hours on the US raid in Venezuela, with the capture of President Nicolas Maduro and his wife. Wall Street was also positive, closing higher with the Dow Jones gaining 1.23%, the Nasdaq up 0.69% and the S&P 500 index up 0.64%, benefiting from bets on the exploitation of the country's oil reserves, the largest in the world. The value of crude oil, however, rose (wti contracted in February at $58.3 per barrel, +1.7%), as foreseeable increases in Venezuelan crude oil production will take a long time, given the decaying condition of Venezuela's infrastructure. In Europe, investors bought oil stocks. Defence stocks were also popular, as analysts do not exclude new international geopolitical twists and turns. Milan finished up 1%, updating new highs not seen since 2000. The spread on the close rose to 69.8 points, with theyield on ten-year BTPs at 3.57%

Investors have started betting that the US intervention in Venezuela, although criticised by many countries as well as the UN, will end up supporting the US economy, guaranteeing the supply of oil and consequently keeping inflation under control. The Federal Reserve itself will have an easy time lowering rates with the carrot no longer driven by the value of petrol. 'In the short run the repercussions are likely to be modest, but in the long run they could provide a major boost to US assets,' Kathleen Brooks, of Xtb, also explained. That is why European stock markets and Wall Street moved higher. Of course, caution remains at the same time, since the situation is fluid and it cannot be ruled out that the US decides to intervene in other countries either in South America, such as Colombia or Cuba, or in the rest of the world, such as Greenland. Moreover, the US President, Donald Trump, has been repeating in recent days that the region should be annexed to the US. In an interview with The Atlantic he stated that that territory, which is part of an allied country in NATO, Denmark, 'we absolutely need it: it's an island surrounded by Russian and Chinese ships'. The Middle East is also looked at with concern, as according to some Arab media Trump and the Israeli premier, Banjamin Netanyahu, have reached an agreement to strike Iran. As for Venezuelan oil, Trump himself declared 'we're going to bring in our big US oil companies - the biggest in the world - who will spend billions of dollars and repair badly damaged oil infrastructure. Let's start making money for the country'.

Wall Street is positive, buoyed by oil and defence stocks. The Dow Jones moved above 49,000 points, updating new records. In particular, eyes are on oil company Chevron, up, and defence company Lockheed Martin. Tech stocks, which had been in contrast on Friday, are also running, as Nvidia CEO Jensen Huang is expected to give a press conference on the prospects for AI. The conference is expected to last an hour and a half and will be held this evening with the US markets closed. Nvidia's stock is meanwhile up moderately. In the meantime, the countdown for the important data that will be published in the coming days has also begun, first and foremost the labour market data for December (Friday, 9 January). On the government bond front, prices are little moved: the yield - which moves inversely to price - on the 10-year bond is stable at 4.189%. The yield on the three-month bond is stable at 3.62%.

At Piazza Affari, Leonardo Leonardo - Finmeccanica (+6.3%) and Fincantieri (+4.5%), the defence stocks, were well bought on the main list. After all, the US military operation in Venezuela encourages military spending, raising numerous question marks over developments in other hot spots, from Iran to Greenland to Taiwan. It stood out Eni (+1.5%) among the few foreign energy companies still operating in Venezuela. The Tenaris did well. Banks, on the other hand, performed contrastingly, topping Banca Pop Er (+3.7%), weak Banco Bpm (-1.7%) and Banca Mps (-1.1%). In asset management, Banca Generali (+2.3% to within a whisker of EUR 59) hit new all-time highs. On the other hand, luxury goods, which were more affected by international tensions, fared poorly.

On the currency market, the euro lost ground at $1.1716 (from $1.1745 at Friday's close), with the greenback remaining a safe haven asset along with gold (up 2.6 per cent to $4,445 an ounce). The single currency is also worth 183.22 yen (from 184.01), while the dollar/yen cross is at 156.37. Bitcoin rose to $93,745 (+2.8%). After a weak start, oil took an upward turn with the February Wti at $58.2 a barrel (+1.7 per cent) and Brent crude at $61.7 (+1.5 per cent).