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Because today Piazza Affari went on a roller coaster.
In the commentary article on the closing of the stock markets, we defined yesterday’s session as insane. Well, today it was even more so, if possible. The explanation is that Milan and the rest of European squares have been in the hands of speculation. That is why Piazza Affari got on a roller coaster today.
Let’s try to explain what happened today on the stock markets, with the analysis of the ProiezionidiBorsa Research Department.
The seemingly inexplicable morning bounce of Piazza Affari
To better understand what happened today on the stock exchange and in particular on the Milan stock exchange, let’s take a step back to yesterday’s session. European stocks closed significantly lower on Thursday, driven by the very negative open on Wall Street. Last night the US stock market closed with strong falls, which had not been seen for a long time. The S & P500 lost almost 4% and the Nasdaq Tech Index more than 4%.
If yesterday the European stock markets had closed strongly due to Wall Street, today they should have opened with a nice minus sign. But no, because rational logic is not the logic of markets, particularly short-term speculation. After 2 hours of trading, Piazza Affari was up more than 1%. Among the stocks in better shape are the banks, led by Banco BPM. This stock gained 3.6% at the end of the session.
Because today Piazza Affari went on a roller coaster
To understand why the Ftse Mib index (INDEX: FSEMIB) bounced off the open, let’s jump head-on to today’s close. At the end of the day, the main blue chip index closed down 0.8% to 19,341 points. Of course, as has happened in all recent sessions, the decline began after 3:00 p.m., coinciding with the inauguration of Wall Street.
You confess that it is difficult for you to understand, right? The drop yesterday afternoon and this afternoon can be explained by the negative trend in the US market. But how to explain the rebound in the morning if yesterday Wall Street closed strongly in the red?
It is explained by the coverage purchases of those who sold short yesterday. Yesterday, many top-class stocks were shorted, particularly banks. That is why today they were the ones that bounced the most. And the best action was, not by chance, Banco BPM, one of the shortest stocks in recent weeks. But that today has taken a good revenge.
Deepening
To know the multi-day analysis and the point of view of the international markets of the Office of Studies ProiezionidiBorsa, click on who.
