Piazza Affari over 50,000 as in 2000. Because this time the bubble will not burst
The wave of euphoria pervading stock exchanges around the world is putting investors on the defensive. This time, however, the rise seems to rest on much more solid fundamentals (war permitting).
Thursday, 14 May, 1.58 p.m.: the fateful figure 50,008 appeared on the stock exchange operators' terminals. The Ftse Mib index has thus broken down another psychological limit, last reached by the main indicator of the Italian stock exchange on the now distant and almost legendary 6 March 2000: right on the eve of the bursting of the Internet bubble. The level was maintained for a handful of minutes, Piazza Affari first fell back to just below the threshold and then accelerated again to end at 50,050, up 1.15% and ready, if necessary, to leap towards the historical record, which remains set at 50,109 points.
The comparison with 2000
Little does it matter, in this respect, that the situation has changed radically compared to 26 years ago, starting with the composition of the Milanese leading index itself. From a numerical point of view - given that back then it was simply called the Mib30 and consisted of 30 securities - and above all from a sectorial point of view, dominated as it was by the Telecom and Tim duo at the height of the era dominated by the so-called 'Tmt' and with two outsiders of the calibre of Seat Pagine Gialle and Tiscali already ready to take over to the tune of billions of euro in capitalisation.
What seems far more relevant today is that the stock market nevertheless seems to be enjoying excellent health in every area of the globe. Again on Thursday, prices rose in Europe, again approaching the record levels reached before the outbreak of the conflict in the Middle East: Frankfurt gained 1.31 per cent, Madrid 0.87 per cent and Paris 0.78 per cent. And quotations also rose further on a Wall Street that in the early stages immediately updated the previous session's records.
The euphoria of the markets
The market seems in this case to have unwavering confidence in the unblocking of the situation in the Persian Gulf and also in the talks between the leaders of its superpowers China and the United States, Xi Jinping and Donald Trump. Evidence of this also seems to be the easing of tensions on government bonds, with bond yields falling at the same time for Treasuries (4.45% on the ten-year) and especially in Europe (3.05% Bunds and 3.78% BTp, with the Italia-Germany spread at 75 basis points). On the other hand, caution remains clearly visible when looking at crude oil prices, which nevertheless remain well anchored above USD 100 per barrel.
"It seems unlikely that markets will start to worry about rising yields and soaring energy costs as long as the artificial intelligence craze persists and US earnings remain at impressive levels," points out Chris Beauchamp, head of market analysts at the trading and investment platform Ig, in this regard. The latest in this respect was Cisco Systems, which gave the stock markets a further boost with a quarterly report that exceeded market expectations.
