September 2014 Performance of the main stock indices Source: Snam on the Bloomberg data The financial markets pag. 1 The utility sector pag. 2 Snam shares and its peers pag. 3 The oil markets In September, crude oil prices decreased both for the U.S. crude benchmark WTI (- 5%, closing at $91.20/barrel) as well as the Brent (-7.9% to $93.20/barrel), affected by weak demand for oil on a global level in a contest of an adequately supplied market and by the strengthening of the dollar. Snam S.p.A. Investor Relations The financial markets The month of September saw a general increase in equity markets, with rises of 0.7% for the European DJ Stoxx50, 2.2% for the Italian stock exchange and 1.9% for the Stoxx Europe Utilities sector index. The sole exception was the American S&P500, which closed down (-1.6%). Stock markets, particularly those in Europe, benefited from the monetary policy measu- res announced by the ECB, which consist of the further reduction in interest rates and the launch of a program to purchase asset- backed securities and collateralised debt obligations in order to facilitate greater liqui- dity within the banking system. The tempora- ry easing of tensions between Russia and Ukraine also boosted the positive trend across European markets. The US stock market was negatively influenced by worse than expected macroeconomic data. From a macroeconomic perspective, in the United States (with reference to the month of August, on a monthly basis) data on orders for durable goods was down (-18.2%), along with industrial production (-0.1%) and the real estate market (new builds -14.4%, buil- ding permits -5.6% and sales of existing homes -1.8%); the final estimate for US GDP in the second quarter of 2014 saw a rise of +4.6% (QoQ annualised) versus the initial estimate of +4.2%. In the Eurozone (with reference to the month of September, on a monthly basis), there was a general decline in leading indicators of economic trends, both for the PMI indexes (composite at 52.3 points, from 52.5 in the previous month), as well as the German Ifo and ZEW indexes. The ECB reduced inte- rest rates by 10 basis points, bringing the benchmark to 0.05% (a new record low) from the previous 0.15%, and partially ad- justed downwards its forecasts for GDP growth and inflation for 2014 (respectively at +0.9% and +0.7%) and 2015 (+1.6% and + 1.1%) . 10.1% 16.6% 5.1% 6.7% 2.2% 1.9% 0.7% ‐1.6% -5% 0% 5% 10% 15% 20% DJ Stoxx 50 S&P 500 DJ Euro Stoxx Utilities FTSE MIB September ‘14 YtD ‘14 Snam shares closed the month down. A mostly positive performance by the markets in September, supported by new expansive monetary policy measures from the ECB Crude oil prices closed down
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September 2014
Performance of the main stock indices
Source: Snam on the Bloomberg data
The financial markets pag. 1 The utility sector pag. 2
Snam shares and its peers pag. 3
The oil markets
In September, crude oil prices decreased
both for the U.S. crude benchmark WTI (-
5%, closing at $91.20/barrel) as well as the
Brent (-7.9% to $93.20/barrel), affected by
weak demand for oil on a global level in a
contest of an adequately supplied market
and by the strengthening of the dollar.
Snam S.p.A. Investor Relations
The financial markets
The month of September saw a general
increase in equity markets, with rises of
0.7% for the European DJ Stoxx50, 2.2% for
the Italian stock exchange and 1.9% for the
Stoxx Europe Utilities sector index. The sole
exception was the American S&P500, which
closed down (-1.6%).
Stock markets, particularly those in Europe,
benefited from the monetary policy measu-
res announced by the ECB, which consist of
the further reduction in interest rates and the
launch of a program to purchase asset-
backed securities and collateralised debt
obligations in order to facilitate greater liqui-
dity within the banking system. The tempora-
ry easing of tensions between Russia and
Ukraine also boosted the positive trend
across European markets. The US stock
market was negatively influenced by worse
than expected macroeconomic data.
From a macroeconomic perspective, in the
United States (with reference to the month of
August, on a monthly basis) data on orders
for durable goods was down (-18.2%), along
with industrial production (-0.1%) and the
real estate market (new builds -14.4%, buil-
ding permits -5.6% and sales of existing
homes -1.8%); the final estimate for US GDP
in the second quarter of 2014 saw a rise of
+4.6% (QoQ annualised) versus the initial
estimate of +4.2%.
In the Eurozone (with reference to the month
of September, on a monthly basis), there
was a general decline in leading indicators of
economic trends, both for the PMI indexes
(composite at 52.3 points, from 52.5 in the
previous month), as well as the German Ifo
and ZEW indexes. The ECB reduced inte-
rest rates by 10 basis points, bringing the
benchmark to 0.05% (a new record low)
from the previous 0.15%, and partially ad-
justed downwards its forecasts for GDP
growth and inflation for 2014 (respectively at
+0.9% and +0.7%) and 2015 (+1.6% and +
1.1%) .
10.1%
16.6%
5.1%
6.7%
2.2%
1.9%
0.7%
‐1.6%
-5% 0% 5% 10% 15% 20%
DJ Stoxx 50
S&P 500
DJ Euro Stoxx Utilities
FTSE MIB
September ‘14
YtD ‘14
Snam shares closed the month down.
A mostly positive performance by the markets in September, supported by new expansive monetary policy measures from the ECB
Crude oil prices closed down
Similarly to the equity markets, individual
sectors have experienced contrasting trends.
Some have registered a declining perfor-
mance, in particular the raw materials sector,
which was negatively affected by worse than
expected economic data from China that has
rekindled fears of a slowdown in the growth
of the world's second largest economy. Oth-
er sectors showed converse results, first and
foremost pharmaceutical, followed by bank-
ing and insurance, the latter two driven by
further expansionary monetary policies
adopted by the ECB earlier this month.
The utility sector also performed well, sup-
ported by the performance of energy compa-
nies.
During the month of September, the utility
sector saw a growth in performance of 1.9%
versus the previous month's end.
The sector’s result was driven by energy
utility companies, which were boosted by the
recovery in electricity prices during the
month. In particular, the sub-sector was
driven upwards by French electricity genera-
tion companies (GDF Suez +6% and EDF
+5%).
The Utility sector in the Stock Market
Source: Snam on the Bloomberg data
Main sector performance, September 2014
Sector and subsector performance, September 2014
‐1.0%
2.8%
‐1.1%
1.9%
-5% 0% 5%
.
Defensive Utilities
DJ Utility
Energy Utilities
Others
The utility sector also performed well, supported by the performance of energy companies.
The Utility sector performance
Financial Markets Review September 2014 Snam S.p.A. Investor Relations