Europe Weakens Again As Investors Seek The Safety Of... Portuguese Stocks!

Tyler Durden's picture

European sovereign bond spreads have not batted an eyelid during the recent Russia-Ukraine crisis... and why should they, Draghi will do "whatever it takes." Even HY credit in Europe is holding up - despite an ugly squeeze wider on Friday (chatter that positioning in very long credit). But with Europe's VIX above 20, the broad European stock index is now below pre-Putin levels. What is perhaps most stunning is that while investors have piled out of German, Swiss, and French stocks in the last few days, they have backed-up-the-truck in "new normal" safe-haven Portugal. The reason proferred by some - Portugal is further from Ukraine (and less dependent on Russia's gas) - which of course is the critical swing factor for an economy that remains crushed aside from trade with Germany.


Stocks are back below Putin levels...


As investors have flushed their core German stock holdings and bid Portugal (and Italy) to the moon...


Which just exacerbates the remarkable divergence among European stocks this year...


We are sure somewhere this all makes sense...It would appear the 'safe-haven' seekers have forgotten that if Germany comes under pressure from Russian sanction retaliation then Europe is in trouble... but hey, why worry, just buy the worst...

Charts: Bloomberg

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sunny's picture

How can this be as the CEO of GE just let the world know (Reuters tweet) that the EU is on the mend.  Goodness!

fonestar's picture

Eventually investors will come around and realize the only real safe-haven left is in the blockchain.

knukles's picture

Seeking shelter in the blockchain or Porugeee stocks makes as much sense as not realizing why NYC's subways are so hot... they're closer to hell.

HRamos_3's picture

É comprar ó freguês é comprar... Há frutóchocolate....

morning's picture

vou curtir tanto quando isto estalar :D

Ifigenia's picture

"Há frutóchocolate"


Is nostalgic. Make me to remember the old good time when it felt good to go to cinema. Fuck the Internet and youtobe

BiggerInJapan's picture

PT está bem fdd para os próximos 20 anos, talvez se começassem a investir na educação de todos os os jovens residentes em Portugal as coisas melhorem daqui a 2 decadas... 

madbraz's picture

And Spanish 10 year bonds at 3.36%, some 35 basis points lower than our 30 year bond!


I wish all central bankers were in that 777, instead of good, ordinary folks.  The world would instantly become a much better place.

The Most Interesting Frog in the World's picture

"We are sure somewhere this all makes sense..."

at The Federal Reserve...

_ConanTheLibertarian_'s picture

Funny, Portugal is actually the furthest away European country for the Ukraine.

Ifigenia's picture

Timeo Danaos et dona ferentes

highly debtful's picture

Ha! You Americans sure are suckers. You need QE 1, QE 2 and QE 3 to keep things afloat, whereas here in Europe all it takes is some cheap talk from a shifty Italian to keep it together.

And if you guys will excuse me now, I'm gonna buy me some Portugese, Spanish and Greek bonds, because my future grandchildren will need to be financially secure, too. 

Plus I need to take my pills now.

Kirk2NCC1701's picture

Well, Portugal probably has more upside potential than Germany's downside potential, and...

Portugal doesn't need nat-gas the way Germany and others do.  They got plenty of sun and wind, and can get oil/gasoline from all sorts of places (Bra-sil!), without having to rely on pipelines.  And they haven't stuck their noses into other people's businees either -- so no 'enemies'. 

Makes perfect sense, actually.

BiggerInJapan's picture

lol, I wish you where right, every single night. oh yeaah