The Post EU Summit Rally Is Already Over

sad french statue


A few negative headlines this morning seem to sparked a selloff after yesterday’s optimism.European markets are flagging and U.S. futures have turned negative.

Indices in Europe just turned negative after a rally this morning. The DAX is now down 0.01%, the FTSE 100 is down 0.16% and the CAC 40 is down 0.18%.

A few things that may have sparked the turnaround:

  • Italy just held an incredibly negative bond auction. Yields for Italian bonds struck their highest level since the country joined the euro at 6.06%. That’s up from 5.86% last month.
  • Italian PM Silvio Berlusconi’s vow to stay on until 2013 may not have helped that, since his commitments to cutting debt and encouraging growth is coming under fire. Italy could be the next weak link in the euro saga.
  • In Spain, unemployment data that came out today showed that 21.5% of the working population is now out of work. That’s the highest unemployment in 15 years.
  • Whirlpool earnings disappointed, a negative sign for durable goods. They’ll lay off more than 5,000 workers, mostly in Europe and North America.

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