Uncertainty in the Middle East; Mib Edges Up Slightly

(Alliance News) - Wednesday's trading session was shaped by escalating tensions in the Middle East and the possibility that the conflict between Israel and Iran could expand to involve the US. "I could do it, or not," said Trump.

Tehran responded to US threats by preparing for war, while Russia--which during the day had to contend with a warning from Sberbank's CEO about an imminent economic slowdown--expressed surprise at the prospect of a US-led military intervention.

Kremlin spokesperson Maria Zakharova stated that "the world is just millimeters away from nuclear disaster."

Among the indices, the FTSE Mib saw a slight improvement, closing up 0.1% at 39,418.61 points. The Mid-Cap fell 0.1% to 53,543.21, the Small-Cap gained 0.5% to 30,981.05, while Italy Growth rose 0.5% to 8,115.60.

Across European financial markets, London's FTSE 100 rose 0.1%, Paris' CAC dropped 0.4%, and Frankfurt's DAX 40 lost 0.4%.

Chris Beauchamp, Chief Market Analyst at IG, commented: "It's been a volatile week for the markets. Fears of an imminent US attack on Iran have eased, but the redeployment of military resources continues, indicating preparations for US forces to join Israel's campaign."

Beauchamp continued: "The conflict between Israel and Iran adds another situation for the Fed to monitor and seems to reinforce the decision to keep rates unchanged. Given the extreme variability of outcomes this year, it's becoming nearly impossible to reliably estimate what monetary policy will look like by year-end, but market expectations for a September rate cut still seem overly optimistic."

Back in Milan, Telecom Italia led the way, rising 4.7% to EUR0.407 per share.

Eni, which gained 0.2% to EUR14.17, announced it had continued its buyback program, purchasing EUR50 million worth of its own shares.

Terna reported Wednesday that in May, Italy's electricity demand was 24.2 billion kWh, down 2.7% from May 2024. The decline was attributed to one fewer working day and lower average temperatures. Renewables met 55.9% of demand in May, setting a record high. Terna closed flat at EUR8.87 per share.

UniCredit announced the issuance of a 12-year Tier 2 subordinated bond, callable after seven years, aimed at institutional investors. The amount issued was EUR1 billion for what is the first Tier 2 issue of 2025, paying a fixed coupon of 4.175% until June 2032, with an issue price of 99.9%, equivalent to a spread of 180 basis points over the reference mid-swap rate. UniCredit ended up 0.9% at EUR56.49 per share.

According to press sources, the market is asking BPER Banca to make a small extra effort to successfully complete the OPS on Popolare di Sondrio, which expires July 11. Subscriptions remain limited, but there is a sense in Milan that a small gesture--perhaps a slight price adjustment--could sway the undecided. This would mean adding around EUR270 million to a deal worth over EUR5 billion. BPER Banca shares closed up 0.7% at EUR7.6 per share.

Leonardo--down 0.2% at EUR48.14--aims to finalize a joint venture by July to relaunch the Grottaglie plant in its aerostructures division. Also in July, a decision is expected on the Bromo project with Thales and Airbus, aimed at strengthening Europe's position in satellite constellations.

Iveco Group was the worst performer, falling 2.1% to EUR15.65 per share.

On the Mid-Cap, OVS led after presenting slightly improved quarterly results--EUR354 million versus EUR352 million in the same period last year--and renewing negotiations to acquire Goldenpoint "to accelerate the brand's relaunch and achieve full synergies." OVS rose 3.7% to EUR3.56 per share.

Lottomatica launched a EUR500 million buyback plan and ended the day down 1.3% at EUR22.94.

BFF Bank performed well, up 1.9% to EUR8.95 and in a positive trend over the past thirty days after Moody's confirmed its ratings, following the agency's recent upgrade of Italy's Baa3 rating outlook to positive from stable and the macro profile to Strong from Strong-.

Alerion closed down 2.3% at EUR16.14 per share.

Among small caps, Cy4gate was the top performer, up 7.1% to EUR5.26. Over the past month, after announcing contracts worth over EUR2 million and appointing Enrico Peruzzi as a new director, the stock has risen 24%.

Fiera Milano announced it had won the tender organized by Fondazione Milano Cortina 2026 for the contract to design, manage, and dismantle temporary infrastructure at the Rho exhibition center for figure skating and ice hockey events. The total cost is EUR30.7 million under the Interim Agreement. Additionally, the company reported progress on its buyback plan, purchasing nearly EUR400,000 worth of its own shares. Fiera Milano advanced 2.4% to EUR5.91 per share.

Class Editori fell again, bucking the trend of recent weeks, dropping over 9% and losing momentum after gaining nearly 96% in the past month of trading.

Among SMEs, Bellini Nautica led with a 7.7% increase to EUR3.20 per share; Ecomembrane followed with a 7.2% rise.

On Wednesday, eVISO announced the strengthening of its direct electricity and gas sales network by adding two new salespeople in Alessandria, Piedmont, and three in Genoa, Liguria. In addition, Pandora purchased eViso shares for a total of EUR98,000. eVISO shares closed up 3.8% at EUR10.34.

Simone also launched a buyback program of up to EUR450,000, with operations set to last for the next 18 months.

ErreDue announced it had signed a contract to sell a containerized electrolyzer for hydrogen production worth around EUR1.4 million with RES - Recupero Etico Sostenibile. The plant, to be located at RES's Pettoranello del Molise site, will produce about 52 tons of green hydrogen annually. ErreDue closed up 2.7% at EUR7.70 per share.

Mare Group--down 1.4% at EUR3.57--acquired over EUR1 million in Eles shares.

In New York, the Dow rose 0.6% to 42,478.37, the Nasdaq gained 0.6% to 19,643.74, and the S&P 500 was up 0.5% at 6,015.11.

In currency markets, the euro traded at USD1.1507 from USD1.1513 on Tuesday evening, while the pound traded at USD1.3452 from USD1.3502 the previous evening.

Among commodities, Brent crude traded at USD75.48 per barrel from USD76.45 at the previous close, while gold was valued at USD3,385.56 per ounce from USD3,390.22 previously.

Thursday's economic calendar includes a public holiday in the US for Juneteenth.

At 0930 CEST, a speech by ECB President Lagarde is expected, followed by a speech from the German Bundesbank's vice president at 1030 CEST and one from Nagel.

At 1100 CEST, Eurozone construction production data will be published, followed by the Eurogroup meeting and another speech by Lagarde. The UK interest rate decision is expected at 1300 CEST.

No significant news is expected from Milan's Piazza Affari.

By Michele Cirulli, Alliance News Reporter

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