Italy debt crisis fears drag markets down

THE ISEQ remained below the 3,000 point mark yesterday — a height it has only scaled once in the past two months — actually dropping by nearly 1.5% as European investors reacted nervously to ongoing jitters regarding the eurozone debt crisis.

Fears that the debt crisis could spread to Italy dragged the main European markets downwards yesterday. London’s FTSE was down by 1%, while the DAX in Frankfurt shed 2.3% and the CAC 40 index in Paris fell by 2.7%.

A horrid day for Italy, itself, saw not only the yields on its long-term Government bonds rise to their highest levels since the birth of the single currency; but also its main bourse in Milan fall in value by 4%; led by falls in its banking shares. In all, European stocks declined the most in almost three months, yesterday.