By CaixaBank research team, in Barcelona | Although the first half of the year has ended with a negative balance for most international stock markets, the latest months has been characterised by a relative improvement in indices. The reduction in fears that Greece will leave the euro and the euro area’s assistance in recapitalising Spain’s banking system marked a turning point in the trend for investors’ appetite for risk. Although…
At the end of the first quarter of 2012, the government debt to GDP ratio in the euro area stood at 88.2%, compared with 87.3% at the end of the fourth quarter of 2011. Eurostat said that in the EU the ratio increased from 82.5% to 83.4%. Compared with the first quarter of 2011, the government debt to GDP ratio rose in both the euro area (from 86.2%) and the EU (from 80.4%). At…
MADRID | The extensive sell-out on Friday shows the desperate situation Spain is facing. Shattered confidence on the government ability to overcome a looming crash landing, is sending shivers down the spine of investors. People are starting to bet Spain will be forced to bailout one of these days. But, unlike other salvaged countries, its sheer size prevents a rescue package from providing a way out in soothing its woes….
By Tania Suárez, in Madrid | Hanseatic Brokerhouse's director general in Spain, Gabriel Montalto, said in a conversation with The Corner that international investors have lost trust over Italy and Spain. Also, he considers that both countries will have to publicly accept the reality of the situation if they want to win back the confidence of markets. Question. Apart from the approval of the national parliaments, are there any other…
MADRID | Most observers take for granted that the rescue seems the most likely scenario. They simply look at the rising trend risk premium shows. They may be right. But the right question to ask is why confidence on Spain is faltering so much.
LONDON | Morgan Stanley recently estimated that liabilities in fines and damages could amount to as much as $22 billion against the dozen banks allegedly involved in Libor-rigging. No one knows. The dimension of the case could scale up once brought to the courts of justice and the spillover on the markets would be extremely difficult to contain. The risk is all too evident. For instance, when Barclays was sentenced…
Being a member of the euro club continues offering confusing evidence of providing protection against the global economic downturn. In the construction sector, seasonally adjusted production rose by 0.1% in the euro area while it grew 1.6% in the European Union in May 2012, compared with the previous month. But in April 2012, production had decreased by 3.7% in the common currency region and 6.9% outside it. Compared with May 2011, production in…
The heaviest economies of the euro zone’s periphery, Italy and Spain, have behaved in a more competitive manner than most sceptics about the laggards of the common currency union would have it. Companies from both Mediterranean countries have increased their presence in markets outside their natural environment, partly forced by a falling domestic demand but due to the strength of production structures and new-found adaptability, too. Here on The Corner,…
LONDON/MADRID | Finance-wise, Italy is unnerving some of its neighbours in the periphery of the euro zone. Particularly in Spain, government officials wonder aloud about the unfairness of the whole situation: while yields of the Spanish 10-year sovereign bonds time and again cross the 7 percent frightening barrier, Italy managed last week to sell €5.25 billion in debt of various maturities at much lower interest rates in most of the…
By valenciaplaza.com | IG Markets' Daniel Pingarrón said in a conversation with VP for The Corner that the European authorities and the Spanish government should improve their timing if they want investors to believe that they can set up a coordinated, effective plan. The Spanish market index Ibex spiked after president Mariano Rajoy announced its austerity policy, but it was a short-lived reaction. Why was that? The recovery of the…