Greece Jumps Most In 8 Months As Rest Of Peripheral Europe Slumps

Tyler Durden's picture

The Greek equity index jumped almost 7% today, its biggest rise in 8 months, on the back of absolutely no 'real' change whatsoever (Greek opinion poll results change by the second and the stability fund payments were already known) and indeed a worsening situation across most of the rest of Europe (ex-Germany) - with chatter of growing bank runs and Bankia's epic demise. Of course, one needs to bear in mind the ASE pop is off 22-year lows before sounding that all-clear here as Bund yields collapse to all-time record lows and Spanish yields (and spreads) to Euro-era record wides (and almost all-time record highs). Broad European equities and credit gapped up at the open (as did EURUSD) but the rest of the day was spent drifting inexorably back to lows as the Euro-Stoxx ended down 0.5% (with Spain - at 9 year lows - and Italy underperforming notably also - with banks halted on and off all day). Spain and Italy saw sovereign spreads leaking (16bps and 8bps respectively) as the former broke 450bps over AAA for the first time (and 510bps over Bunds). Corporate and financial credit spreads leaked back wider from the positive start to the day and ended still modestly tighter on the day - though financials notably underperformed non-financials. EUR-USD basis swaps improved modestly but EURUSD round-tripped from a decent open to Thursday/Friday highs over 1.26 and back down towards Friday's close - with the USD -0.2% from Friday's close - as AUD strength helped exaggerate the move mildly. Commodities are following USD's lead and as it strengthens into the European close, they are losing early gains (Copper/Oil up around 0.6%, Gold Unch, Silver down 0.5%). USD and Oil weakness into the European close were the most notable micro-trends.

The Athens Stock Exchange Index jumped almost 7% today - the last 2 times it did this was followed by 4-5 down-days in-a-row - don't hold your breath...

and Spain's IBEX Index fell over 2% closing at its lowest level in 9 years...

European sovereigns limped wider aside from Spain and Italy which ended at the day's worst levels (and the former near all-time record wides)...

and for once European stocks in general front-ran credit - though it looks like equity just catching up to last week's credit deterioration (also financials underperformed non-financials into the close)...

and the USD (and EURUSD implicitly) round-tripped (orange curve) as once the US came on line (630am ET) admittedly a closed market, AUD began to drift lower (red arrow) relative to USD which dragged on US equity futures which were also trading - closing near ther session lows (but up around 6pts - though 8pts off the overnight highs (notably rich to broad-risk-assets - though we note TSYs not open to temper reality)...

Charts: Bloomberg