Italian Stocks/Bonds Dump (And EUR Slump) On Auction Disappointment

Tyler Durden's picture

Europe saw red today. Italian equities and bonds traded notably off (with FTSEMIB now -2.7% on the week) amid their biggest drop in over a week and heading back to post-election lows. The driver was a less-than-desirous auction at the short-end of the Italian bond curve (the part of the curve that Draghi 'promised' would be fine) as the 12-month bill went out 43bps above the January lows. This sparked weakness overall as across the board weakness was evident in stocks and bonds in Europe. EURUSD dropped back below 1.2950 for the first time in 3 months. Commerzbank's recap also stumbled markets a little even though it was widely rumored and Europe's financials underperformed broadly. A late-day ramp - oddly starting at 1130ET (when Europe used to close pre-DST) - just like we saw yesterday - saved the day for stocks and crediy overall.




Charts: Bloomberg

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SheepDog-One's picture

Meanwhile, nothing can put even a tiny dent in US equities full-retard exhuberancefest we find ourselves in now...even the slightest red is immediately doubled into green territory.

This is going to end very badly, someday.

eclectic syncretist's picture

yeah, when the market crashes and the banks lose all the free money, and the taxpayers pay for it all,....AGAIN!

Mrmojorisin515's picture

What does it matter if it goes down one day? or a week for that matter?  If the value of the market is still over priced, what does it matter?

eclectic syncretist's picture

Maybe it was just a drone getting shot down by some pissed off motherfucker who's had enough of this bullshit.

medium giraffe's picture

That, or the divergence between fundamentals and stock performance is so great that trying to plot it on a graph has caused a tear in the space time continuum due to accidentially transgressing some incontrovertible universal rule of logic.  If that's the case then some poor Quant in an office in SA just lost all of his windows and mastery of his lower bowel.

jubber's picture

rallying into a potential Italian collapse seems slightly stupid. Grillo has already said he can't work with PL, Barsani,Monti or Belusconi, therefore there will be no chance of a Government and the country will be thrown into chaos as new elections will have to be Friday if I am nor mistaken.

SheepDog-One's picture

Well yea...but that's all the way off to Friday! Still plenty of time for this Sterno chugging party to go on before we have to worry about any messy hangover!

bonzo112358's picture

Uncle Ben would just fix it by adding another $40 Billion/month so no one notices.  More money for the big players fixes everything.  Italy can go down in flames and he would just point in a different direction and tell us there is nothing to see here.

chdwlch1's picture

Draghi should have bought some bonds from today's auction yesterday ala Ben "Oops, that's never happened to me before" Bernanke...

FuzzyDunlop21's picture

EURUSD looks like one big floppy cock yet S & P is full erect fuck this

reload's picture

Yes but LOOK at Euro/GBP -- good call MR STOLPER. Arrived at the party just as the punchbowl dried up, as do GS have any FX customers left? amazing

swissaustrian's picture

weak EUR, strong SMI. Thank you SNB!

jubber's picture

Huge AH ramp in Europe to the highs of the day for the DAX, CAC, FTSE 7 now the IBEX down all day and now HOD's while all of them closed nearly an hour ago, what a farce this all is

NihilistZero's picture

Anbody think the seemingly bulletproof stock market run is what will accelerate the pop of Housing Bubble 2.0???

I think the smart money intended to exit the SFH specuvesting orgy by late 2014 at the latest.  But with the yields being squeezed on flips and rentals due to intense demand, I have a feeling the smart money will liquidate sonner than anybody expected to get in on the final turns of the DOW merry-go-round.


NihilistZero's picture

Double Post, sorry :-)