Italy's sudden imposition of windfall taxes on banks scared off global stock markets

Sam Sam
Updated
coverImg
Source: DepositPhotos

The Hang Seng Index opened lower on Tuesday and initially fell to the level of 19,500 before rebounding. It rose to 19,370.8 points at 11:16 but then softened. Mainland China released its July trade data at 11 o'clock. In dollar terms, the country's imports and exports in July amounted to $482.92 billion, a decrease of 13.6%. Exports declined by 14.5%, falling short of market expectations of a 13.2% drop. Imports decreased by 12.4%, also lower than the market's anticipated 5.6% decline. The trade surplus was $80.6 billion, narrowing by 19.4%. Following the release of the data, the Hang Seng Index weakened slightly. It stabilized after falling to 19,112.61 points in the afternoon. The index had a daily trading range of 258.19 points with a turnover of HKD 104.62 billion. The Hang Seng Index, the H-share index, and the Hang Seng China Enterprises Index fell by 1.81%, 2.18%, and 2.78% respectively.


According to foreign reports citing China Evergrande Group (2007), the company has failed to make timely interest payments and its available funds have continued to decrease, leading to temporary liquidity pressure. The company is currently actively optimizing its fund arrangement to safeguard the legitimate rights and interests of creditors. Evergrande's stock price fell by 14.394%, marking the largest decline among blue-chip stocks. Its affiliated company, Evergrande Services (6098), also dropped by 9.677%.


The Hang Seng Index closed with a bearish candlestick, breaking below the 200-day moving average, 20-day moving average, and 50-day moving average. The MACD histogram widened, indicating a bearish signal. There were 471 advancing stocks and 1,174 declining stocks throughout the day, reflecting overall market weakness.


The Italian government has approved a 40% windfall tax on bank net interest income, applicable only for this year. According to sources cited by foreign media, the local government expects to generate nearly 3 billion euros in revenue. The government states that the collected taxes will be used to assist mortgage borrowers and implement tax reduction measures. This news has dampened the Italian stock market, with the MIB index falling by almost 2.1% and dragging down other markets' performance.


Moody's has downgraded the credit ratings of 10 small and mid-sized US banks, and placed larger banks like Bank of New York Mellon, US Bancorp, and State Street Bank on a downgrade watchlist. Moody's indicates that the US banking industry remains strong but faces multiple pressures, while also warning of risks associated with commercial real estate. The three major US stock indices have declined.


The overnight futures and American depositary receipts (ADRs) dropped, indicating a weak trend for the Hang Seng Index (HSI), with support at around 19100/18900 levels.


Mainland China will release the consumer price index (CPI) and proton pump inhibitor data for July at 9:30, with an expected decline of -0.4% for the former and -4.1% for the latter. The data is expected to provide insights into mainland China's deflation/inflation situation and add uncertainty to the market conditions.



* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

goTop
quote
Do you find this article useful?
Related Articles
placeholder
The Mag 7 have lost their touch – Wall Street might need some new bloodThe Magnificent 7 are falling apart, and Wall Street needs new players to fill the gap. That’s the state of things right now, as the top seven tech names—Microsoft, Apple, Alphabet, Tesla, Amazon, Nvidia, and Meta Platforms—fail to carry the market the way they did in the past.
Author  Cryptopolitan
Yesterday 06: 37
The Magnificent 7 are falling apart, and Wall Street needs new players to fill the gap. That’s the state of things right now, as the top seven tech names—Microsoft, Apple, Alphabet, Tesla, Amazon, Nvidia, and Meta Platforms—fail to carry the market the way they did in the past.
placeholder
Elon Musk says he’s ready to leave DOGE next month, Tesla stock surges in anticipationSpeaking during Tesla’s earnings call, Elon confirmed that his work at President Donald Trump’s Department of Government Efficiency (DOGE) will drop “significantly” by next month. The company’s stock shot up nearly 5% in after-hours trading.
Author  Cryptopolitan
Apr 23, Wed
Speaking during Tesla’s earnings call, Elon confirmed that his work at President Donald Trump’s Department of Government Efficiency (DOGE) will drop “significantly” by next month. The company’s stock shot up nearly 5% in after-hours trading.
placeholder
Trump Targets Nvidia’s H20 Export! Nvidia Shares Drop 7% in After-Hours Trading, Nvidia-Related Stocks TumbleAmid escalating U.S.-China trade tensions, the Trump administration has targeted Nvidia’s H20 chips, specifically designed for the Chinese market—by imposing new export licensing requirem
Author  TradingKey
Apr 16, Wed
Amid escalating U.S.-China trade tensions, the Trump administration has targeted Nvidia’s H20 chips, specifically designed for the Chinese market—by imposing new export licensing requirem
placeholder
Nvidia Soars 10% on $500B Supercomputer Plans While AI Tokens RNDR, TAO, and FET Rally: Why MIND of Pepe Could Be NextEven while stock markets are mired in uncertainty, AI tokens continue to mount a rebound. Behind the scenes, the crypto AI sector is exploding after fresh announcements from OpenAI and NVIDIA. Could one brainy meme coin, MIND of Pepe, outthink them all? NVIDIA and OpenAI Fuel AI Crypto Rally The AI crypto narrative is heating […]
Author  Bitcoinist
Apr 15, Tue
Even while stock markets are mired in uncertainty, AI tokens continue to mount a rebound. Behind the scenes, the crypto AI sector is exploding after fresh announcements from OpenAI and NVIDIA. Could one brainy meme coin, MIND of Pepe, outthink them all? NVIDIA and OpenAI Fuel AI Crypto Rally The AI crypto narrative is heating […]
placeholder
Trump Exempts 3C Tariffs, Apple-Related Stocks Surge! Beware of Trump's Reversal Amid Apple’s Moment in the SpotlightTradingKey - The  U.S. government’s decision to exempt smartphones, computers, and other electronics from reciprocal tariffs may allow Apple (AAPL.US) to be the first major beneficiary of a reprieve f
Author  TradingKey
Apr 14, Mon
TradingKey - The  U.S. government’s decision to exempt smartphones, computers, and other electronics from reciprocal tariffs may allow Apple (AAPL.US) to be the first major beneficiary of a reprieve f