European stock markets started 2013 on a positive note and were up between January 2 and 4 (Milan +4.2%, London +2.8, Frankfurt +2.2%, Paris +3.0%).
Investors welcomed the US budget agreement which reduced the possibility of a “fiscal cliff”; global rating agencies, however, highlighted the limited impact of the new policies on the country’s deficit. Good news, moreover, came from the German labor market (unemployment rate at 6.9% in December) and from the US manufacturing industry (ISM manufacturing index).
Auto & Parts stocks performed in line with market and posted a 3% gain in the week. According to broker CITI, the best performing stocks of 2012 – Premium OEMs and tyre makers – are likely to continue on their path and could lead gains in 2013.
Pirelli closed the week at €8.95, up 3.4%, with an average daily volume of 1.5 million shares (3 month average is 3 million shares traded per day). Target price is at €9.9 with 83% of analysts recommending to Buy or Hold the stock.