To Italeave Or Not? Confused European Traders Shift Attention Away From France
A quick glance at the soaring Italian stock market and one would have faith in the future of the euro, with Alitalia just a ‘storm in a teacup’. However, bond traders are as worried about political uncertainty as ever with Italian bond risk surging to over 3 year highs.
As Bloomberg reports, the FTSE MIB Index is trading near a 15-month high after ex-Prime Minister Matteo Renzi resoundingly won back the leadership of the Democratic Party.
But bonds tell a slightly different story, with a wider yield spread to France showing investors are wary of the country’s political uncertainty as Renzi faces an uphill battle to regain his role as prime minister.
This post was published at Zero Hedge on May 3, 2017.