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Milan stock market ends week upbeat boosted by banks

by Andrea Fontana

The trading week ended on a decidedly upbeat note on Friday for the Milan stock market (following Thursday’s dip) on the back of positive news coming from across the Atlantic. Strong quarterly financial reports released by three major banking groups combined with a 0.6% increase in U.S. retail sales for September (despite a decline in U.S. consumer confidence) boosted Wall Street and the dollar.

At the close of trading, the FTSE MIB was up 1.98% to 16,591 points, boosted largely by the banking sector where BPM and Banco Popolare were standouts ahead of a shareholders’ meeting of Popolare di Milano to approve a merger of the two. Their shares rose, respectively, by 6.08% (to €0.42) and 6.25% (to €2.55).

Intesa San Paolo also gained (+2.75%), as did UniCredit (+1.94%), despite speculation surrounding an imminent capital increase which could be much bigger than previous estimates. According to some rumors, CEO Jean Pierre Mustier is said to be considering a €13 billion capital hike, a significant amount considering that market cap yesterday stood at €12.78 billion. The final amount will be officially announced on December 13 in London when bank officials will present a new strategic restructuring plan.

Banca Carige bucked the bank, ending down 3.87% at €0.31 on rumors of stricter ECB requirements on minimum capital requirements and a €500 million capital increase.
Unipol rose more than 5%. UBI Banca gained 3.5% as shareholders approved the creation of a single bank that incorporates the seven subsidiaries of the parent company.

Among energy stocks, Falck Renewables gained 3.83% in heavy trading to close at €0.81. It was boosted by Edison’s public tender offer for Alerion, which drew fresh attention to the sector. The company, based in Sesto San Giovanni (Milan), produces energy from wind, solar power, biomasse and waste and is one of the only European pure-plays in the renewable energy sector.

Oil major ENI was up (+1.98% to €13.42) as it continued to ride the wave of higher energy prices. Ditto for Saipem (+2.35% to €0.41).

Utilities echoed the positive showing for the sector across European markets. ENEL rose 1.91%. A2a ended up 2.06%.