Investing.com - Financial Markets Worldwide

Flash Comment: The Italian Market Panic - Drivers And Near-term Outlook

ByDanske Markets
Published 05/30/2018, 03:02 AM

Summary points:

The Italian bond sell-off reached unprecedented levels yesterday and is starting to have significant global ramifications as we saw during the euro debt crisis in 2012.

The current market panic is a reflection of several drivers, including possible continuing Italian political vacuum, poor market liquidity as well as fears over the lack of rescue options in case of a full-fledged Italian debt crisis.

The likely failure to appoint an interim government may result in new elections or alternatively the immediate appointment of the Five Star/League government but with strings attached from the president to their policy programme.

We continue to stay sidelined for now in respect to BTP exposure - it may be tempting to add a short BTP future but taking the ultra-high volatility into account, the risk adjusted return is not attractive.

To read the entire report Please click on the pdf File Below:

Latest comments

Loading next article…
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2025 - Fusion Media Limited. All Rights Reserved.