Venerdì, 19 Ottobre 2018

Italian spread soars, markets slump on Monti announcement


(see related stories)
Rome, December 10 - Italian state bonds came under
intense pressure and stock markets throughout Europe suffered
big losses in early trading on Monday after Premier Mario Monti
said at the weekend he would resign when the 2013 budget law is
The announcement came after ex-premier Silvio Berlusconi's
People of Freedom (PdL) party said it had stopped backing
Monti's administration and the media magnate said he would run
for a fourth term at the helm of government in upcoming
The spread between 10-year Italian bonds and the German
benchmark soared almost 40 basis points to reach 362, with a
yield of 4.87%.
The spread, a barometer of Italy's borrowing costs and of
investor confidence in the country's ability to weather the
eurozone crisis, had closed at 323 points with a yield of 4.5%
on Friday.
The Milan stock exchange suffered the continent's biggest
losses in morning trading on Monday, with the FTSE Mib index
3.68% down after almost three hours of trading.
Bank stocks were hit especially, with Intesa Sanpaolo
losing 7% and Unicredit 6.09% down.
Concern that political uncertainty in Italy could worsen
the eurozone crisis was seen in all of Europe's main money
The Madrid stock exchange lost 1.98% of its share value.
The Frankfurt and Paris exchanges were 0.58% and 0.67% down
London lost 0.31%.
German Finance Minister Wolfgang Schaeuble said that Berlin
did not expect "any destabilisation in the eurozone" but it did
"expect Italy to keep going forward by respecting its European
However, his counterpart in Madrid, Luis de Guindos,
expressed concern.
"When doubts emerge about the stability of a neighbour
country like Italy, which is perceived as vulnerable, the
contagion is transmitted between us immediately," de Guindos

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