Europe Red As Italy Continues Post-Short-Sale-Ban Slide

Tyler Durden's picture


Portuguese bond spreads have been weak all week; Spain has been bleeding in the front-end and belly of the curve; and today saw Italian bonds start to lose some gains. What is perhaps more notable is the weakness in Italian stocks (most notably banks) since the short-sale ban was lifted on Friday. FTSEMIB is down 3.5% from pre-FOMC and -5% from post-FOMC spike highs. EURUSD is back below 1.30 (and stands 1.5 sigma rich to swap-spread-implied levels). Meanwhile, Europe's VIX plummets to six-month lows as realized vol plunges - but the volatility risk premium is still high.

Can you spot when Italy lifted its short-sale ban?


EURUSD is now significantly rich to 'fair' valuye based on swap-spreads...


and bond spreads continue to leak - with Italy catching up to Spain...


Europe's VIX is plunging again - as realized vol also drops... but these vol risk premium is 'relatively' high


Charts: Bloomberg

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Thu, 09/20/2012 - 11:58 | 2815165 jerry_theking_lawler
jerry_theking_lawler's picture

Silver Bitchezzz!!

Thu, 09/20/2012 - 12:08 | 2815189 pasco35
Thu, 09/20/2012 - 12:19 | 2815234 PiratePawpaw
PiratePawpaw's picture

Argentum Canem!!!

Thu, 09/20/2012 - 13:00 | 2815419 CPL
CPL's picture

It's a resistant little rock isn't it once all the margin is scraped from it.

Thu, 09/20/2012 - 12:00 | 2815166 spastic_colon
spastic_colon's picture

Sales proceeds coming to Amerika.....indexes

Thu, 09/20/2012 - 12:00 | 2815173 Dareconomics
Dareconomics's picture

Spain is in trouble:

Pretty soon, I will be doing the same analysis with Italy and France. Watch my blog.

Thu, 09/20/2012 - 12:13 | 2815208 fuu
fuu's picture


Thu, 09/20/2012 - 13:47 | 2815570 gggunchi
gggunchi's picture

His blog isn't bad.  Helluva lot better than most of the shit the American and German populations read.  (NYT & der Spiegel) 

Thu, 09/20/2012 - 12:01 | 2815174 tocointhephrase
tocointhephrase's picture

All your wages are belong to us!

Thu, 09/20/2012 - 12:05 | 2815186 LULZBank
LULZBank's picture

Must be desperation...

Thu, 09/20/2012 - 18:42 | 2816454 smiler03
Thu, 09/20/2012 - 12:12 | 2815199 Negro Primero
Thu, 09/20/2012 - 12:10 | 2815194 slaughterer
slaughterer's picture

SHCOMP long EUROSTOXX short.  

Thu, 09/20/2012 - 12:16 | 2815219 slaughterer
slaughterer's picture

OPEC cutting refinery cap.  Uh, what was the half life on that pledge to keep prices down?  Three days?

Thu, 09/20/2012 - 13:06 | 2815444 CPL
CPL's picture

Looks like

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