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Babies And Bathwater: Indiscriminate Selling Hits EM As Indonesian Stocks Dive, Rand Routed

It's indiscriminate.

It's indiscriminate.
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1 comment on “Babies And Bathwater: Indiscriminate Selling Hits EM As Indonesian Stocks Dive, Rand Routed

  1. At least contagion stopped spreading against Italy. After Fitch confirmed its rating (but also negative outlook from stable) BTPs are rising, and today some italian banks in the main index FTMIB40 are up 6%. MIB40 is outperforming Europe for the 3rd day in a row.

    For every increase of the Bund-BTP spread of 100bp, Tier1 capital is affected by 20-100bp. So a 2-8% correction for italian banks was justified, but 30% was overdone. Apparently at certain levels fundamental investors buy. Some banks have a P/E of 6 now. Let’s see how long it will last. The budget to be presented to the EU is still hanging.

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