Spanish Yields Above 7% as Ministers Gather in Brussels

Arthi Gupta
09 Jul, 2012
New York City

The European indexes edged lower and Spanish yields jump above 7% as finance ministers gather in Brussels. German exports rose more than expected in May and French gross domestic product is estimated to fall by 0.1% in the second quarter.

[R]12:50 PM Frankfurt – The European indexes edged lower and Spanish yields jump above 7% as finance ministers gather in Brussels. German exports rose more than expected in May and French gross domestic product is estimated to fall by 0.1% in the second quarter.[/R]

European markets were on the edge after Spanish and Italian yields jumped and finance ministers gathered in Brussels for the last time before the summer break.

Ministers are expected to finalize the terms of bailout for Spain, Cyprus and may look for ways to offer concession to Greece after the latest meeting of international creditors with the newly formed Government.

Greek government won a vote of confidence in parliament on Sunday that paved for the way for the bailout negotiations with troika. Greece is looking to extend the payment terms, loosened austerity measures and the release of more funds to pay for government expenses.

In Paris trading, the CAC-40 Index declined 17.10 or 0.5% to 3,151.69 and in Frankfurt the DAX Index edged lower 19.75 or 0.3% to 6,390.58.

The yields on Spain’s benchmark 10-year bonds rose 15 basis points to 7.10%. Italian 10-year yields climbed 10 basis points to 6.13%.

German Exports Up

Germany''s exports increased more than expected in May, the latest data from the Federal Statistics Office showed today.

Exports increased 3.9% on a monthly basis in May following a 1.7% drop in April and imports surged 6.3% on a monthly basis in May following a 4.9% slump in April.

The trade surplus rose to €15.3 billion in May from a revised €14.5 billion surplus in April. The current account balance surplus was €9 billion in May compared to €11 billion in April.

French Confidence Wanes

The business confidence index for the French industrial sector declined to 91 in June, the lowest since August 2009, from 92 in May, data released by Bank of France showed.

Gainers & Losers

BMW AG dipped 0.6% to €56.07 after the automobile manufacturer announced £250 million investment in its UK manufacturing operations by the end of 2015.

Rémy Cointreau SA fell 1% to €88.49 after the wines and spirits producer entered into exclusive takeover negotiations with Bruichladdic’s shareholders.

Wolford AG plunged 2.7% to €27.88 after the hosiery and lingerie manufacturer said fiscal 2012 sales rose 1.3% to €154.1 million from last year. Profit for the year slumped 73% to €1.4 million compared to €5.1 million a year-ago quarter.