9 Stocks to Buy on the Italian Stock Exchange Following Upcoming ECB Rate Cuts

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Shifting Monetary Policies and Stock Market Prospects

The recent shift in monetary policy by the European Central Bank (ECB) and the Federal Reserve (Fed) opens new horizons for the stock market.
Analysts at Equita are particularly optimistic, highlighting nine stocks on the Italian stock exchange, known as Piazza Affari, that are set for a potential rally following anticipated interest rate cuts.

Recent macroeconomic data supports this outlook.
For instance, Ing reports that “the preliminary estimate of German inflation for August suggests that the ECB is likely to continue lowering interest rates in its September meeting.” Analysts expect a sector rotation fueled by monetary easing, positively impacting industrial stocks and mid-small caps that were adversely affected during the previous rate hike cycle.

Equita’s Economic Outlook

Equita predicts that the economy will not enter a recession and expects the ECB to implement six rate cuts by 2025.
This scenario is expected to benefit sectors such as utilities, pharmaceuticals, telecommunications, food & beverage, real estate, and chemicals.

Stocks to Watch in the Coming Weeks

1) Enel – At the forefront of defensive stocks, Enel has shown a modest year-to-date increase of 1.8%, but has gained 13.7% over the past six months.
The stock’s defensive nature and strong cash flow generation make it appealing in a declining interest scenario.
Banca Akros has set a target price of €10.2, while Equita recommends a “buy” with a target of €7.70.

2) A2A – Another utility alternative, A2A holds a neutral stance from analysts due to high competition.
They anticipate clearer signals of operational improvement before changing recommendations.

3) Snam – A solid pick with a stable dividend but limited growth outlook in the current market.
Analysts recommend holding the stock, with a target price of €5.20.

4) Hera – Known for adaptability and solid fundamentals, Hera is also viewed as a stable yield option with potential appreciation.
Six out of seven analysts rate it “buy,” with a target of €4.

5) Italgas – Positioned well to leverage rate cuts, though recent estimates have been adjusted downwards.
Analysts remain optimistic about its long-term prospects.

6) Amplifon – Facing competition, analysts recommend holding the stock until clearer strategic directions emerge.

7) Campari – Recently struggling, analysts believe a shift in rates could enhance consumer spending in their sector, making it a stock to consider.

8) Diasorin – Despite fluctuations, Diasorin remains high-quality, with optimistic growth revisions following strong quarterly results.

9) Inwit – With robust fundamentals benefitting from 5G expansion, analysts maintain a cautious yet positive outlook amid industry consolidation opportunities.

Disclaimer

The information in this article is for informational purposes only and should not be considered as an investment recommendation.
Readers are responsible for their own investment decisions, reflecting their risk tolerance and time horizons.

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