Because today Piazza Affari went up on a roller coaster.
In the commentary article on the closure of the stock exchanges, we defined yesterday’s session as crazy. Well, today’s was even more so, if possible. The explanation is that Milan and the rest of the European squares have been in the hands of speculation. That’s why Piazza Affari went 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 rebound of Piazza Affari
To better understand what happened today on the stock exchange, and in particular on the Milan stock market, let’s take a step back to yesterday’s session. European stock exchanges closed with significant falls on Thursday, driven by the very negative opening on Wall Street. Last night the US stock market closed with heavy falls, which had not been seen for some time. The S & P500 lost nearly 4% and the Nasdaq technology index more than 4%.
If yesterday the European stock exchanges had closed heavily down 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, in particular of short-term speculation. After 2 hours of trading, Piazza Affari was up by more than 1%. Among the stocks in great shape were banks, with Banco BPM in the lead. This stock gained 3.6% at the end of the session.
Because today Piazza Affari went up on a roller coaster
To understand why the Ftse Mib index (INDEX:FSEMIB) bounced off at the opening, let’s jump straight ahead at today’s close. At the end of the day, the major blue chip index closed down 0.8% at 19,341 points. Of course, as has happened in all the last sessions, the descent started after 3.00 pm, coinciding with the opening of Wall Street.
You confess that you have a hard time understanding, right? The fall yesterday afternoon and this afternoon can be explained by the negative trend of the US market. But how to explain the rebound in the morning if Wall Street closed heavily in the red yesterday?
It is explained by the cover purchases of those who sold short yesterday. Yesterday, many blue chip stocks were subject to short trades, particularly banks. That’s 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 multidays analysis and the point of view of the international markets of the ProiezionidiBorsa Study Office, click who.
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