European markets start off the week on a positive note
Stocks, Italian bonds and the euro rallied after hints by Italian deputy prime minister Matteo Salvini that his country was open to shifting its budget deficit goal
London — European stocks, Italian bonds and the euro rallied on Monday on signs that Rome was preparing to rework the spending plans that have left it facing formal EU disciplinary action. A bounce in oil prices after their ‘black’ Friday, the survival chances of Britain’s newly-sealed Brexit agreement and renewed Russia and Ukraine tensions were keeping traders busy too, but it was Italy that stole the show. Deputy Prime Minister Matteo Salvini had hinted on Sunday at the possibility of tweaking the country’s budget deficit goal, saying “no one is stuck” to the 2.4% target and the signs of a shift continued on Monday. Italy’s banks index duly leapt 5.3% which put it on track for its strongest day since June, while shorter-term Italian borrowing costs fell sharply in the bond markets to their lowest since September. “It will help the banks if the BTP-Bund spread goes lower which it has been this morning,” Pierre Bose, head of European strategy at Credit Suisse Wealth Management, sai...
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