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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spastic_colon's picture

Sales proceeds coming to Amerika.....indexes

Dareconomics's picture

Spain is in trouble:

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

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) 

slaughterer's picture

SHCOMP long EUROSTOXX short.  

slaughterer's picture

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