The hot topic in Europe right now is the rise in fragmentation risks and how the ECB is letting that slide - at least for now - with the central bank likely to struggle to find a solution as it prepares to raise rates for the first time in over a decade in July.
Italian bond yields have jumped since the ECB policy decision yesterday and the selloff is hitting local stocks - banks in particular - rather hard again today. A look at the FTSE MIB daily chart:
The drag isn't just being confined to Italy as other European indices are also tumbling again today. Here's a glance of how the others are performing:
- Eurostoxx -1.4%
- Germany DAX -1.5%
- France CAC 40 -1.5%
- UK FTSE -1.3%
- Spain IBEX -2.0%
The euro is barely hanging on in there with EUR/USD down 0.2% to 1.0595 at the moment as the technicals are looking a bit shaky.
