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Reports from Reuters claim that there was a fall in financial assets in Spain and Italy on Monday. However, it was noted that the 10-year Spanish public bond yields rose significantly, hitting the highest point in Euro-era of 7 percent. This rise was largely attributed to the country’s consistent concern to its financial and banking problems.
Fiscal markets opened with a high following the triumph of pro-rescue parties in Greece, which won with a simple majority in the elections that were held over the weekend. However, the release proved brief especially after the Euro dropped against the US dollar.
One bond trader noted that the markets wish to fade the release rally, and Spain suddenly seems to be blowing out again.
The trader also added that Spain seems like it will remain under pressure until Thursday saying that it is still hard to determine what can stop the country’s yields moving further up.
Spanish bond yields rose by 22 basis points the day they increased by 7.14 percent. This seems to be the highest point in Euro’s lifetime. Greece, Portugal, and Ireland were strained to get international rescue immediately their 10-year yields surpassed 7%.
Italian bond yields went up with 15 basis points to hit 6.08 percent. According to Reuters, Spanish 10-year yields premium over Italy went up with 108 basis points, which is also a euro-era high.
Stock markets in Spain and Italy recorded an underperformance. Market indicator in Spain fell 0.9% while the Italian indicator fell by 1.2%. FTSEurofirst upturned early increase and it had lastly dropped by 0.11 percent.