European equities continue to trade heavily with The FTSE 100 within a whisker of touching its lowest level since April. More comments. In a recurring theme of late, the main cause of the weakness is coming from Italy with bond yields rising once more after the finance minister delivered a downbeat assessment of the country’s fiscal outlook. The pound is drifting a little lower, mainly due to a strong buck with the GBP/USD rate hovering around just above the $1.30 handle.
Finance minister’s speech does little for bonds
Another day, another negative news story out of Italy for the markets. This morning a testimony from finance minister Giovanni Tria in which he told parliament of expectations for a deterioration of the international macroeconomic situation and a weakening of the business environment has done little for the plight of of government debt, with yields moving rising once more and taking out recent highs. Since the larger than expected budget deficit was announced the week before last it’s been a near negative news flow from Italy as both bond and stock markets have tumbled. Having said that, while this situation looks unlikely to be resolved in a positive manner any time soon, there is only so many times that markets can discount what is essentially the same piece of bad news. It is worth pointing out that while yields have been on the rise in the past week or so, the increase has been fairly steady and not anywhere near as abrupt as the spike seen back in back in May.
Aviva (LON:AV) stock rises after CEO forced out
Investors seem to have reacted positively to the news the Aviva is parting company with its chief executive, Mark Wilson, after almost six years in the role. Shares in the FTSE 100 insurer rose as much as 1.5% after the news broke, with the firm citing a need for new leadership. After a bright start at the beginning of his tenure, the stock has underperformed its peers in recent years and investors are likely hoping that a change in leadership will bring about a change in fortunes. Shares have fallen close to 2-year lows in recent weeks and firm clearly feel like a change at the top is needed to halt the run of poor performance.