Lunedì, 24 Settembre 2018

Milan's main stock exchange plunges by 4.5% on uncertainty


Milan, February 4 - Italy's major stock market
dropped by a full 4.5% on Monday as investors fretted over the
possibility of significant political turmoil if ex-premier
Silvio Berlusconi wins re-election later this month.
On the Milan Stock Exchange, bank shares also weighed on
the FTSE Mib, which lost 4.5% of its value, closing the day at
16,539 points.
The uncertainly over Italy's political future also pushed
wider the spread between Italy's benchmark 10-year bond and its
ultra-safe German counterpart by 20 basis points, to close at
282 points.
The yield on 10-year Italian paper stood at 4.45% at the
close of Monday's trading.
Investors appeared concerned over a rise in popularity for
Berlusconi, who says that he intends to undo many of the fiscal
austerity reforms put in place by the technocratic government of
Premier Mario Monti.
Berlusconi also plans to refund a tax on primary residences
- the much-maligned IMU imposed by Monti, who is also seeking
election when Italians go the polls on February 24 and 25.
Financial markets have applauded Monti's reforms as helping
the country's economy through crisis while reducing interest
rates and cutting spending.
Bank shares were also weak Monday as investors continued to
digest the implications of the scandals plaguing Monte dei
Paschi di Siena (MPS), Italy's third-largest bank.
Shares in MPS lost 4.83% in Monday's trading after
prosecutors called on Giuseppe Mussari, ex-chairman of the
troubled bank, to answer questions about alleged fraud at MPS.
The bank was thrown into crisis in January when it emerged
that a shady series of derivative and structured-finance deals
produced losses of 720 million euros.
There have also been reports of bribes and corruption by
bank officials regarding, among other things, the
nine-billion-euro acquisition of rival Antonveneta in 2008.
Meanwhile, other European markets were roiled by a
corruption scandal that threatens Spanish Premier Mariano Rajoy.
Opposition leaders called for Rajoy to resign as one
opinion poll showed his centre-right political party at its
lowest point on record.
In Frankfurt, the DAX lost 2.5% to reach 7,638.23 points,
while London's FTSE 100 lost 1.58% to close at 6,246.84 points,
Paris's CAC 40 ended the day lower, falling 3.01% to 3,659.91
points, and Spain's IBEX 35 closed trading 3.77% lower at
7,919.60 points.

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