European Yields Soared After Lackluster ECB Showing

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		Tech Science Entertainment Wall Street Markets Strategy Sports Lifestyle Politics Law International Video Latest Thursday, August 2, 2012 European Yields Soared After Lackluster ECB Showing European Central Bank President Mario Draghi disappointed investors hoping for explicit promises for central bank assistance to Spain and Italy in a press conference this morning. That disappointment was immediately reflected in sovereign bond yields, a proxy for each government's borrowing costs. The yields on Italian and Spanish 10-year bonds shot higher when investors realized that no definitive moves were forthcoming during Draghi's speech. Yields for 10-year Italian and Spanish bonds closed the day 33 basis points and 43 basis points higher, respectively. At the end of the day, the yield on the Italian 10-year was 6.33 percent, and the yield on the Spanish 10-year was 6.17 percent. Interestingly, this sharp spike in yields was not reflected in shorter-term borrowing, in particular for bonds that do not mature before the ECB's two three-year long-term refinancing operations (which allowed banks to borrow at incredibly low rates from the ECB). The Spanish two-year yield actually fell by 11 bps while the yield on Italian bonds of the same maturity fell by 3 bps. Take a look at the percentage change Spanish (green) and Italian (orange) 10-year yields today: Click for larger image.  Read » Also On Money Game Today: Get Important Economic News Every Morning With 'Money Game Select' WORLD CENTRAL BANKS ON 'RED ALERT' These 15 Companies Are Leading A US Manufacturing Renaissance STOCKS TANK AFTER ECB FLOP: Here's What You Need To Know Advertisement CHART OF THE DAY: Bill Gross's Long History Of Being Wrong About The Stock Market CHART OF THE DAY: We're About To Hit A Pivotal Moment In The Housing Recovery CHART OF THE DAY: If History Is A Guide, Then Stocks Will Surge Through The Rest Of The Year Share this: Facebook Twitter Digg Reddit StumbleUpon LinkedIn The email address for your subscription is: ipat39@gmail.com Change Your Email Address | Unsubscribe | Subscribe | Subscribe to the Money Game RSS Feed Business Insider. 257 Park Avenue South, New York, NY 10010 Terms of Service | Privacy Policy

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