Italy Bonds Pass Auction Test in a Sign of Easing Market Jitters
- Both five- and 10-year sales oversubscribed, but pricing mixed
- Political risk is still a ‘thick fog:’ ADM Investor Services
This article is for subscribers only.
Italy successfully sold five- and 10-year debt at an auction, bringing some relief to jittery markets following this week’s meltdown in the nation’s bonds amid a political crisis.
Both auctions were oversubscribed by investors, buoyed by large reinvestment flows from a bond maturing later this week. Still, the pricing of the longer-dated note showed signs of the pessimism that has battered the market this week. The average sale price on the 10-year bond was 25 cents below the secondary-market level just before the bidding deadline. A similar gauge for the five-year one was 24 cents higher.