Italian Stock Exchange: Why March 2026's strong rally is just the start of a new phase
If you've turned on your monitor in these first few days of March, you'll have noticed something big is moving beneath the surface of the Piazza Affari. It's not just the positive sign at the top of the lists; it's the way the market is moving. The volumes, folks, the volumes. After weeks of uncertain trading and timid handovers, the trading value has accelerated at a pace not seen in months. Anyone who has followed the Italian Stock Exchange for at least twenty years immediately recognises the symptom: when real money moves, it leaves its mark.
The figure that tells the story of the turnaround
Let's look at the numbers from the recent sessions, the ones that really count. On Friday, February 27, the daily trading value approached levels usually seen only during the big year-end rushes. It wasn't an isolated final flourish: on Monday, March 2, the Ftse Mib continued to run, supported by buying flows coming mainly from abroad. Those who had built up short positions in previous weeks – when the market seemed uncertain, especially after the session on February 20 – had to scramble for cover. The old adage "the trend is your friend" transforms here into "volume is king".
The engines behind this rally
Let's try to isolate the factors driving the market to these levels. It's not a single push, but a mature combination:
- The banking sector is leading the charge. Italian institutions, after years of cleaning up their balance sheets, are presenting themselves with still-attractive multiples and headline-grabbing dividend yields. Anglo-Saxon funds, which stayed away until January, are now returning with substantial orders.
- Utilities and energy are holding up well. In a context of slightly falling rates and controlled inflation, large-cap stocks offer both refuge and yield.
- The repositioning of institutional investors. The Italian Stock Exchange is seen as a "safe haven" within the Old Continent, thanks to an improving debt-to-GDP ratio and a political stability that, for once, doesn't scare the markets.
Keep an eye on corrections, but the structure is changing
Attention: I'm not trying to paint a picture of a rampant bull market. Markets take the stairs up and the elevator down, and there will be profit-taking even on these days. But the difference, compared to a month ago, is the depth of the order book. The high trading value means we are not facing a flash in the pan by retail traders, but genuine medium-term bets. The strong hands are building positions.
Those who follow the market from the inside know that certain phases need to be interpreted. The sharp increase in trading seen on February 26, for example, coincided with the full-scale entry of accumulation plans by large pension funds. It's no coincidence that the most liquid stocks, those in the main basket, have performed better than small caps.
Outlook: now the real action begins
If I had to make a bet, I'd say the second quarter will open with a more selective Italian Stock Exchange. Until recently, you could just buy the index and sleep soundly. Today, you'll need to pick the right horses. The sectors that have rallied the most might make way for comebacks in more cyclical areas, like automotive and industrial machinery, which have so far lagged behind.
One thing is certain: liquidity is there, and plenty of it. And when liquidity meets confidence, valuations can push beyond reasonableness. For now, we are in the phase of reasonableness, but all eyes are on the next quarterly reports. If earnings confirm the momentum, get ready to see historical highs revisited.
And remember: in the stock market, the winner isn't the one who times the market, but the one who understands the direction. And the direction, today, is clearly north.