Mon, May 21, 2018
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: Has Italy crossed the Rubicon?

Monday, December 05, 2016

Zurich / New York, December 5, 2016 – Jon Jonsson, Senior Portfolio Manager Global Fixed Income at Neuberger Berman

Our first thoughts on the Italian referendum result.

The decision by the Italian electorate to vote No in yesterday’s referendum on constitutional reform has numerous ramifications. In the short term, yields on Italian government bonds are likely to soar while spreads against other major European bonds will continue to widen. Volatility will increase, not just in Italy but across Europe. Further down the road, there is also the possibility that Italy could be downgraded by the ratings agencies, precipitating a rise in its borrowing costs.

Most worryingly, the No vote could exert a baleful influence on the ailing Italian banking sector, where banks such as UniCredit, Banca Popolare and, in particular, Monte dei Paschi di Siena have been under intense pressure all year due to their non-performing loans.

It’s important to remember, however, that the referendum was not about Italy’s continued membership of the European Union – although it has been interpreted as such in many quarters. Prime Minister Matteo Renzi was seeking to expedite the political process by limiting the power of the Senate and ensuring the Lower House becomes the primary legislative body. His initiative received both internal and external support from domestic politicians and international organizations such as the OECD. Indeed, in a 2015 report, the latter observed t......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. News Briefs - Warren Buffett: Target date funds aren't the way to go, Cambridge Analytica could be reborn under a different name[more]

    Warren Buffett: Target date funds aren't the way to go Planning for retirement can be complicated and stressful. This is why target date funds - funds that are managed based on when you expect to retire - are so attractive. Over time, the balance of stocks, bonds and cash evolve automati

  2. Investing - Hedge funds hike Smurfit Kappa positions amid takeover deal hopes, Hedge fund IBV Capital digs deep to unlock long-term value in a competitive market, Eisman of 'The Big Short' fame recommends shorting Deutsche Bank[more]

    Hedge funds hike Smurfit Kappa positions amid takeover deal hopes From Irishtimes.com: Two US hedge funds, Davidson Kempner and York Capital, have accumulated a combined 4.74 per cent interest in cardboard box maker Smurfit Kappa using financial derivatives. It comes as many investors cl

  3. Foundations of hedge fund managers gave big to controversial donor-advised funds[more]

    In the world of philanthropy and tax-deductible charitable giving, the explosion of donor-advised funds has touched off intense debate. Now, there is evidence that the DAF boom is being further fuelled by hedge fund foundation money. Four of the top five foundations that gave the most to large do

  4. Study: For hedge funds, smaller is better[more]

    From Institutionalinvestor.com: The smaller the hedge fund is, the better its performance is likely to be, according to a new study. The study - "Size, Age, and the Performance Life Cycle of Hedge Funds," released April 26 - sought to determine whether a hedge fund's size and age had any effect on i

  5. Hedge fund returns rose in April for first gain since January[more]

    From Bloomberg.com: Bloomberg Hedge Fund Database shows returns flat this year - Currency strategies had the biggest monthly gain at 13% Hedge fund returns increased 0.78 percent in April, reversing two consecutive monthly declines. The swing of 134 basis points was driven by gains in all seven