By Richard Milne and David Oakley in London Eurozone bond markets suffered a mass sell-off on Tuesday as investor fears spread beyond Italy and Spain to triple A-rated France, Austria, Finland and the Netherlands.
The premium that France and Austria pay over Germany to borrow rose to euro-era records of 192 basis points and 184bp respectively, levels investors say are no longer consistent with top credit ratings. “Markets are losing patience so they are going for the jugular, which is the core countries and not the periphery,” said Neil Williams, chief economist at Hermes, the UK fund manager. “There is convergence but it is convergence on the weakest.” Mike Riddell of M&G, one of Europe’s biggest fund managers, called it “probably the most worrying day” of the crisis so far. The rise in bond yields affected all main eurozone countries apart from Germany, and suggests that the two-year-old sovereign debt saga could be entering a dangerous phase. In a day that euro-era records tumbled, Italian yields moved through 7 per cent – a level viewed as unsustainable – for the second time in a week. The Spanish premium to Germany hit 482bp, above the critical 450bp rate at which Irish and Portuguese yields spiralled out of control and forced both countries into international bail-outs. Belgium also saw its bonds’ spread over German debt reach record levels of 314bp. Mariano Rajoy, the Spanish opposition leader forecast to win the country’s general election on Sunday, insisted that the next government would take the necessary measures to preserve Spain’s membership in the eurozone. “I believe in Europe, I believe in the euro project,,” he said. “ I want to fulfil the tasks that we all need to do as members of the euro.” Paul Griffiths, global head of fixed income at Aberdeen Asset Managers, said: “We don’t want exposure to the periphery and we are wary of buying anything in the eurozone in these markets.” Traders said there were few buyers in many bond markets, with only the European Central Bank active in Italy and Spain. “It is really scary,” said one at a US bank. “Everyone is liquidating in the eurozone bond markets ... Everyone is heading for the door.” German benchmark 10-year yields fell slightly to 1.77 per cent. Finnish and Dutch yields rose 17bp and 10bp, leaving their premiums to Germany close to 2009 euro-era peaks. Additional reporting by Victor Mallet in Madrid http://m.ft.com/cms/s/0/c9efa9fe-0fb5-11e1-a36b-00144feabdc0.html Powered by Telkomsel BlackBerry® ------------------------------------ Kunjungi situs http://www.info-saham.com untuk informasi seputar saham. SEMUA POSTING DI MILIS INI TANGGUNG JAWAB PENGIRIM EMAIL DAN BUKAN ADMIN MILIS. SEMUA POSTING DI MILIS INI BUKAN UNTUK MENGAJAK MEMBELI ATAU MENJUAL EFEK. SETIAP KEPUTUSAN INVESTASI MENJADI TANGGUNG JAWAB PIHAK PEMILIK INVESTASI ATAU PEMILIK MODAL. [email protected] untuk berhenti dari milis saham [email protected] untuk bergabung ke milis saham Yahoo! Groups Links <*> To visit your group on the web, go to: http://groups.yahoo.com/group/saham/ <*> Your email settings: Individual Email | Traditional <*> To change settings online go to: http://groups.yahoo.com/group/saham/join (Yahoo! ID required) <*> To change settings via email: [email protected] [email protected] <*> To unsubscribe from this group, send an email to: [email protected] <*> Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
