Thursday 21 September 2017

Shares suspended as state steps in to rescue Monte dei Paschi

Trading in Monte dei Paschi shares was suspended yesterday, and Italian government bond yields fell, with 10-year yields slipping to 1.81pc. Stock photo: Depositphotos
Trading in Monte dei Paschi shares was suspended yesterday, and Italian government bond yields fell, with 10-year yields slipping to 1.81pc. Stock photo: Depositphotos
Donal O'Donovan

Donal O'Donovan

Trading in Monte dei Paschi shares was suspended yesterday, and Italian government bond yields fell, with 10-year yields slipping to 1.81pc.

Italy's government is set to rescue Banca Monte dei Paschi di Siena after the world's oldest lender failed to raise €5bn from the market. Monte Paschi said in a statement it will ask the government for a "precautionary" capital increase.

Elsewhere, key stock indexes around the world were little changed, as were the dollar and US Treasury yields, in thin trading ahead of a holiday weekend for Christmas.

In Dublin the stock market was only open for a half day and trading was thin. The Iseq index closed up 0.44pc at 6,515.99.

Elsewhere, the dollar held steady against a basket of major currencies, lingering about half a percentage point below a 14-year peak set earlier this week.

US Treasury prices were slightly firmer in thin volumes as investors awaited economic data due to be released ahead of an extended holiday weekend. "We're a little stronger, the curve is a little flatter, but volume has been anaemic," said Justin Lederer, an interest rate strategist at Cantor Fitzgerald in New York.

Trading volumes have been muted this week, which is also the last full week of trading this year. US markets will be shut for the Christmas holiday on Monday.

US equity indexes turned positive but remained near their Thursday closing levels.

European stocks were mixed, with banks edging higher after two regional bellwethers settled investigations into US mortgage securities and the bailout for Monte dei Paschi was approved as the Italian government looked to end a protracted banking crisis that has gummed up the economy.

Crude oil futures slipped below $55 a barrel as the stronger dollar weighed.

Irish Independent

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