Venerdì, 19 Ottobre 2018

Bond spreads soar, markets tank on uncertainty about Spain


(ANSA) - Milan, September 26 - Bond spreads soared and
European markets tanked on Wednesday over uncertainty whether
Spain would weather its debt crisis without aid.
European markets burned through a collective 133 billion
euros in capitalization.
Spanish Premier Mariano Rajoy warned that Spain would
request aid if its bond interest remained too high for too long
in a Wall Street Journal interview published Wednesday.
The difference between interest rates on Spanish and German
10-year bonds soared 44 basis points Wednesday to close at 460,
with the yield on ten year Spanish bonds at 6.06%.
The spread between interest rates on Italian bonds and the
German benchmark closed at 375 basis points - a 24 point rise
over Tuesday's close.
The yield on Italian 10-year bonds was 5.21%.
The spread, for Italy and Spain, is the key barometer of
their governments' borrowing costs and of market confidence in
their ability to weather the eurozone crisis.
Madrid's Ibex 35 crumpled more than other European stock
indices, closing at 7,854.4 points down 3.92%.
The poor performance of Milan's FTSE-MIb was not far behind,
and closed at 15,408 points, down 3.29%.
In Milan, banks - with their substantial exposure to
Italian debt - were the hardest hit stocks.
Unicredit, Mediolanum, BPM and UBI all lost more than 5%.
Banco Popolare fell 6.18%.
Other European market indices - Paris's CAC 40 down 2.82%,
London's FTSE-100 down 1.56%, Frankfurt's DAX down 2% - also
lost significant ground.

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