Interesting stuff happening in European markets today.
We’ve mentioned already how Greece is diving hard. Currently Athens is down 2.36%.
What’s interesting is that the severity of the decline is not being shared by other PIIGS. The selloff in Spain is fairly modest.
Where you are seeing intense selling is the European core.
Germany is getting whacked, with the DAX off 1.3%. Shares of Deutsche Bank are off 1.5%.
Nobody doubts that the German economy is one of the strongest in the world right now, but its exposure — particularly its banking exposure — to Greece is a major worry source of worry.
Last week, CLSA’s Chris Wood advised investors to put on the “core infection” trade, buying CDS on Germany and France, as the PIIGS exposure would soon come home to roost.