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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
EQUITIES
- European banks have been dramatically impacted by the escalation of the Russia/Ukraine conflict this month, with the SX7E index (Euro banks) down over 20% from peak to trough.
- This is a second ‘shock’ for European banks following recent Lira depreciation in Q4 2021, which significantly impacted Spanish banks due to their ‘large’ exposure to Turkey (particularly BBVA).
- This time, it seems that UniCredit is the most exposed to the current conflicts, with the bank totaling nearly 25bn EUR in exposure to Russia (assets) according to the EBA.
- UniCredit stock price is down nearly 30% this month, breaking below its 200DMA this morning.
- Next support to watch on the downside stands at 10.39, which is the low reached on Nov 30 2021.
- Next key level to watch on the downside stands at 9.8180, which corresponds to the 61.8% Fibo retracement of the 6.09 – 15.85 range.
- UniCredit lost 10bn EUR in market cap this month, currently standing at 25bn EUR, bringing the price-to-book ratio down to 0.40.
- Despite their attractive valuations based on a range of 'value metrics', the prolonged deterioration in the Russia/Ukraine conflict could weigh on European financials as the ECB may delay its tightening cycle to limit the economic downturn.
Source: EBA/Benjamin Braun
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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