German weakness, new EC growth estimates drag markets lower

Milan’s FTSE-MIB ends down 2.5% at 15,291 points as Fiat f

German weakness, new EC growth estimates drag markets lower

Milan, November 7 - Italy's stock market on Wednesday followed its European peers and Wall Street into negative territory as worries about a slowing Germany economy coupled with new, lower, European Commission growth forecasts for 2013 outweighed an initial rally following the re-election of US President Barack Obama. Overall, European markets ended the day some 100 billion euros in the red. Milan's FTSE-MIB Index ended 2.5% lower, at 15,291 points, while the FTSE All Sahre ended 2.34% lower, at 16,206. Weighing on the Italian market were industrials like Fiat, which closed down 6.65% at 3.5 euros, and financials, like Uniecredit (-4.33%), BPM (-4.38%), UBI (-3.5%), Banco Popolare (-3.46%) and Intesa Sanpaolo (-3.35%). Luxury goods shares also had a negative day, with Ferragamo and Tod's closing 0.56% and 0.59% lower, respectively. The spread between Italy's 10-year benchmark bond and its German counterpart closed at 352 basis points, slightly higher with respect to Tuesday's closing at 345 basis points. The yield on 10-year Italian paper, at 4.90%, remained essentially unvaried with respect to Tuesday's 4.89%. Earlier Wednesday, the European Commission lowered its eurozone growth forecasts for 2013 to 0.1% from a previous May estimate of 1.0%. Other European markets performed equally poorly. Spain's IBEX 35 ended the day 2.26% lower, Paris' CAC 40 closed down 1.99%, Frankfurt's DAX gave up 2% and London's FTSE 100 was off 1.58% on Tuesday's close.

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