​Survey: Investors Are Optimistic About Forex Market in Italy

After the freeze of the worst months of the pandemic, Piazza Affari now looks with a decidedly more positive attitude towards the prospects of the next six months. This was revealed by the survey conducted in May by Assiom Forex among its associates in collaboration with Il Sole 24 Ore Radiocor.

According to 75% of the operators, in fact, the Milan stock exchange has started on a bullish trend which according to 12% will be very strong, with earnings above 10%. Compared to a month ago increases were expected by 54% of operators with a 13% super-optimistic. As a result, the percentage of pessimists is now down to 6% in May (with a 3% of operators expecting a drop of more than 10%) while a month ago decreases were expected by 27% of operators. Representation of those who expect stable markets presented a definition that includes maximum changes of 3% both upwards and downwards.

“The gradual return to normal following a two-month lockdown seems to be proceeding smoothly at the moment, helping to maintain the confidence of financial operators that the economic recovery can proceed at a faster pace than expected.” - explains the president of Assiom Forex Massimo Mocio - Supported by this cautious optimism, in addition to the financial support coming not only from the ECB but also from a possible European support package of 750 billion euros, most financial operators expressed themselves favorably about the continuation of the rally stock exchange in the next six months¨.

After the collapse of the GDP in the first quarter (and waiting for the data on the second), the Italian economy should regain the path of growth already in the third quarter. It is convinced 25% of the operators who took part in the survey, while for a further 29% the sign of growth will return only in the fourth quarter. Overall, therefore, the return to growth in the second half is estimated by 54% of operators although the change for the whole of 2020 will inevitably be negative.

According to the latest projections released by Istat this month, the Italian GDP should experience 8.3% drop in 2020 and then rise by 4.6% in 2021. The scenario of 2021 for a return to growth is the one that 46% of Assiom Forex operators look at, who remains unconvinced that there could be a significant acceleration of economic activities already in the second half despite the end of the lockdown measures.

For the vast majority of Assiom Forex operators, the moments of greatest tension for the spread seem to be behind us. It should be noted that the survey was closed before the ECB announced the decision to increase the endowment of the pandemic purchase program by 600 billion to 1350 billion euro and to extend its duration to at least June 2021, a move that allowed further mitigation tensions on the sovereign debt market, especially for the benefit of Italian government bonds.

However, the survey already captures greater confidence in the next movements of the spread if it is true that for 17% of the interviewees the spread is expected to drop between 100 and 150 points (from 9%) while for a further 73% it will continue to oscillate between 150 and 200 points. In total, therefore, for 90% of Assiom Forex operators, a lasting overrun of 200 points is unlikely while a month ago this percentage was at 79%. Consequently, the percentage of those who do not exclude a new leap in the spread beyond the 250 point share drops to 10% from 21%.

The foreign exchange markets are not expected to experience major shocks over the next six months. This is what 56% of operators predicted (59% a month ago) while a rise in the euro is expected by 30% of what took part in the survey (29% a month ago). On the other hand, declines are accounted for by 14% of operators, against 12% in April. On the foreign exchange market, extraordinary monetary policy measures launched by the ECB in Europe and by the Fed in the United States will also weigh on the one hand, as will the timing of exit from the lockdown and recovery of economic activities at pre-covid levels. There remains a high degree of uncertainty in the foreign exchange market but appear unlikely drastic change in current balance of power.

(Source:https://www.ilsole24ore.com/art/assiom-forex-operatori-ottimisti-borse-e-spread-ADRdvHW )