The logo of a Mediobanca Premier bank branch in Brescia, Italy, on Friday, Jan. 24, 2025.
Bloomberg | Bloomberg | Getty Images
Shareholders of Italian lender Mediobanca on Tuesday rejected a 13-billion-euro takeover offer from smaller domestic peer Monte dei Paschi, amid a ramp-up in consolidation bids in the Italian banking sector.
“The Offer is devoid of industrial and financial rationale and is therefore destructive for Mediobanca,” the lender said in a statement.
The company added that the proposal has no industrial value, compromises Mediobanca’s identity and business profile, as well as gains for shareholders of both the lender and Monte dei Paschi, “given the likelihood of a significant loss of customers in those business areas (such as Wealth Management and Investment Banking) which require professionals who are independent and of high standing and professionalism.”
CNBC has reached out to Monte dei Paschi for comment.
The world’s oldest bank, the bailed-out Monte dei Paschi (MPS) unexpectedly launched an all-share takeover proposal for Mediobanca (MB) on Friday, offering 23 of its shares for 10 of those of its acquisition target and valuing Mediobanca’s stock at15.992 euros each — or a 5% premium to the close price of Jan. 23. Some analysts have questioned the synergies that might result from the two banks’ union, with a Barclays note on Jan. 27 flagging that “this complementarity, the value creation drivers and in general MPS strategy on MB are not yet clear.”
Tuscany’s Monte dei Paschi, which required state rescue in 2017 after years of battering losses, has long been the poster child of trouble in the Italian banking sector, before a brisk turnaround in its fortunes after the 2022 appointment of UniCredit veteran Luigi Lovaglio to helm the bank.
The Italian government has long sought to privatize the lender, but retains a 11.73% stake after diluting its position last year. Monte dei Paschi’s investors include Mediobanca shareholders such as business tycoon Francesco Gaetano Caltagirone and Delfin — the holding company of late billionaire Leonardo del Vecchio, which increased its MPS stake to 9.78% since January.
The Rome government of Giorgia Meloni has long attempted to find a partner for Monte dei Paschi, which was once courted as a potential acquisition target by UniCredituntil talks dissolved in 2021. Last year, Italy’s third-largest lender Banco BPM purchased a 5% stake in Monte dei Paschi from the government. But UniCredit’s surprise $10.5 billion offer for Banco BPM in November has paralyzed any potential further moves on MPS, pushing Rome into a corner and pitting UniCredit CEO Andrea Orcel against Meloni.
Back in September, UniCredit also unexpectedly spread its wings with a stake build in German lender Commerzbank, raising questions over potential ambitions of cross-border consolidation.
This is a breaking news story. Please refresh for updates.
U.S. Federal Reserve Chair Jerome Powell testifies before a Senate Banking, Housing and Urban Affairs Committee hearing on “The Semiannual Monetary Policy Report to the Congress,” at Capitol Hill in Washington, U.S., Feb. 11, 2025.
Craig Hudson | Reuters
The popular narrative among Federal Reserve policymakers these days is that policy is “well-positioned” to adjust to any upside or downside risks ahead. However, it might be more accurate to say that policy is stuck in position.
With an abundance of unknowns swirling through the economy and the halls of Washington, the only gear the central bank really can be in these days is neutral as it begins what could be a long wait for certainty on what’s actually ahead.
“In recent weeks, we’ve heard not only enthusiasm — particularly from banks, about possible shifts in tax and regulatory policies — but also widespread apprehension about future trade and immigration policy,” Atlanta Fed President Raphael Bostic said in a blog post. “These crosscurrents inject still more complexity into policymaking.”
Bostic’s comments came during an active week for what is known on Wall Street as “Fedspeak,” or the chatter that happens between policy meetings from Chair Jerome Powell, central bank governors and regional presidents.
Officials who have spoken frequently described policy as “well-positioned” — the language is now a staple of post-meeting statements. But increasingly, they are expressing caution about the volatility coming from President Donald Trump’s aggressive trade and economic agenda, as well as other factors that could influence policy.
“Uncertainty” is an increasingly common theme. In fact, Bostic titled his Thursday blog post “Uncertainty Calls for Caution, Humility in Policymaking.” A day earlier, the rate-setting Federal Open Market Committee released minutes from the Jan. 28-29 meeting, with a dozen references to the uncertain climate in the document.
The minutes specifically cited “elevated uncertainty regarding the scope, timing, and potential economic effects of possible changes to trade, immigration, fiscal, and regulatory policies.”
Uncertainty factors into the Fed’s decision making in two ways: the impact that it has on the employment picture, which has been relatively stable, and inflation, which has been easing but could rise again as consumers and business leaders get spooked about the impact tariffs could have on prices.
Alibaba is back in the spotlight — with U.S.-traded shares soaring nearly 70% so far in 2025 — as a favored play on Chinese artificial intelligence. The company said Thursday its AI-related product revenue grew by triple digits for a sixth-straight quarter in the period ended December. Its Qwen AI model has proven itself a capable rival to DeepSeek , along with winning a deal for iPhones sold in China . Founder Jack Ma, once politically sidelined, made his latest public reappearance on Feb. 17 — with a front-row seat at a rare meeting Chinese President Xi Jinping held with entrepreneurs , including DeepSeek’s Liang Wenfeng. Several analysts think Alibaba’s gains will continue, with Jefferies setting a $156 price target as of Feb. 20. That’s upside of more than 8% from Friday’s close of $143.75. UBS equity strategists on Thursday said they have switched out PDD for Alibaba in a model portfolio “given its exposure to AI and quant factors.” Remember how just several months ago the Temu parent had a larger market cap , raising concerns that Alibaba was struggling to compete on its core e-commerce business? Taobao and Tmall Group saw sales rise 5% in the latest quarter. As excited as many investors are about AI opportunities in China, crowding into related stocks has only picked up by 0.02 so far this year on UBS’s scoring system. That’s far below the increase of 0.2 in the crowding score for U.S. AI-related names over the last two years, UBS said. Alibaba had the highest crowding score among large Chinese internet technology names, the report said. “Our Quants team’s analysis previously suggested that stocks with reasonable but improving crowding have seen the most near-term outperformance.” Hong Kong’s Hang Seng index hit a three-year high Friday with China Unicom, Lenovo and Alibaba’s locally traded shares leading gains. “Should investors rotate from Alibaba to the AI trade laggers (i.e. Tencent and Baidu)? Not for now,” JPMorgan internet analyst Alex Yao wrote in a Feb. 17 note. “We think both Tencent and Baidu’s share prices could be driven by AI development in different ways with different risks.” U.S.-listed shares of Baidu are up by about 8% for the year so far, despite the company sharing on Feb. 18 that its AI Cloud revenue rose 26% year-on-year to 7.1 billion yuan in the fourth quarter. Hong Kong-traded shares of Tencent , which has yet to report earnings for the period, have risen by about 24% for the year so far. JPMorgan is neutral on Baidu, but overweight on Tencent and Alibaba. The firm has a price target of $125 on Alibaba shares, suggesting a 13% decline from Friday’s close. At least four other major investment firms have a buy rating on Alibaba. But Morgan Stanley is notably more cautious with an equal-weight rating and a price target of $100. That would imply a drop of 30% from Friday’s close. The firm pointed out that Alibaba’s capital expenditures were 11% of revenue in the latest quarter, versus 3% in the prior quarter — a potential weight on future margins that management warned about. Morgan Stanley also highlighted risks such as weaker consumption and a slower pace of enterprise digitalization. — CNBC’s Michael Bloom contributed to this report.
Former Walmart U.S. CEO Bill Simon contends the retailer’s stock sell-off tied to a slowing profit growth forecast and tariff fears is creating a major opportunity for investors.
“I absolutely thought their guidance was pretty strong given the fact that… nobody knows what’s going to happen with tariffs,” he told CNBC’s “Fast Money” on Thursday, the day Walmart reported fiscal fourth-quarter results.
But even if U.S. tariffs against Canada and Mexico move forward, Simon predicts “nothing” should happen to Walmart.
“Ultimately, the consumer decides whether there’s a tariff or not,” said Simon. “There’s a tariff on avocados from Mexico. Do you have guacamole with your chips or do you have salsa and queso where there is no tariff?”
Plus, Simon, who’s now on the Darden Restaurants board and is the chairman at Hanesbrands, sees Walmart as a nimble retailer.
“The big guys, Walmart,Costco,Target, Amazon… have the supply and the sourcing capability to mitigate tariffs by redirecting the product – bringing it in from different places [and] developing their own private labels,” said Simon. “Those guys will figure out tariffs.”
Walmart shares just saw their worst weekly performance since May 2022 — tumbling almost 9%. The stock price fell more than 6% on its earnings day alone. It was the stock’s worst daily performance since November 2023.
Simon thinks the sell-off is bizarre.
“I thought if you hit your numbers and did well and beat your earnings, things would usually go well for you in the market. But little do we know. You got to have some magic dust,” he said. “I don’t know how you could have done much better for the quarter.”
It’s a departure from his stance last May on “Fast Money” when he warned affluent consumers were creating a “bubble” at Walmart. It came with Walmart shares hitting record highs. He noted historical trends pointed to an eventual shift back to service from convenience and price.
But now Simon thinks the economic and geopolitical backdrop is so unprecedented, higher-income consumers may shop at Walmart permanently.
“If you liked that story yesterday before the earnings release, you should love it today because it’s… cheaper,” said Simon.
Walmart stock is now down 10% from its all-time high hit on Feb. 14. However, it’s still up about 64% over the past 52 weeks.
Sign up for the Spotlight newsletter, a hand curated collection of video clips selected by CNBC’s top editors and producers. Your daily recap of top business highlights and leading stories.