MILAN (AFP) – Milan's main stock market index, the FTSE MIB, was showing a loss of 3.61 percent in late afternoon trading on Thursday as the eurozone debt crisis continued to weigh on investor sentiment.
Banking shares plunged, with Intesa Sanpaolo stock dropping 6.22 percent, UBI Banca sliding 5.57 percent, Banco Poplare down 5.37 percent and UniCredit down 5.32 percent.
The loss reflected investors concerns over the effect and implications of complex arrangements announced Thursday to rescue Greece for a second time and also to stop debt contagion in the eurozone.
And Germany's warning on Wednesday that rescue arrangements announced last week did not amount to a blank cheque did nothing to reassure nervous markets, forcing borrowing costs for debt-strained eurozone countries to rise.
The Italian treasury was forced to pay increased rates to raise 942 million euros ($1,362 million) with 10-year bonds, sold with a yield of 4.07 percent compared to 2.51 percent for the last similar operation on May 27.
Bond rates had already risen on Tuesday for a nine-billion-euro short-dated bond issue and investors will be closely watching a sale of medium and long-term bonds on Thursday.
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