Thursday, May 23, 2013

European Stocks Dive Most In 10 Months

Stock market of Brussels
Stock market of Brussels (Photo credit: Wikipedia)
There was quite a bit of dispersion among European equity indices today (with Italy worst and Spain actually holding up - albeit down 1.4%) but the European equivalent of the S&P 500 (the BE500) dropped 2% - its biggest single-day plunge in 10 months.

Credit markets - just as in the US - have been warning of a disconnect for two weeks and today's equity dive has more than halved that divergence. European sovereigns are wider by 10-15bps. Europe's VIX is over 2 vols higher at 18.4% (its highest in a month).

European financial stocks dropped by their most in 3 months and European high-yield credit worsened by its most in 3 months. A late-day ramp made things look a little better than they had earlier with a 100 pip rally in EURUSD off earlier lows seemingly providing some help. Read more >>
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