- Harvinder Sian, a fixed income strategist at Royal Bank of Scotland
Spain raised 4.81 billion euros of debt in an auction on Thursday, with nation's borrowing rates dropping sharply from the previous auction. The average yields on Spanish government securities, due to mature in 2022, dipped to 5.66% to 6.65%. Demand strengthened slightly, with bids exceeding supply 1.6 times.
"The result is decent, but it doesn't follow that the market will react positively as it pushes back the timetable," said Harvinder Sian, a fixed income strategist at Royal Bank of Scotland in London.
"A bad auction will push Rajoy to seek a bailout, a good one means he might vacillate again."
"Overall the auctions today were taken comfortably," said Nick Stamenkovic of Ria Capital Markets, "but a sustainable decline in yields really depends on the Spanish government coming up to the plate and asking for a sovereign bailout."
The Stoxx Europe 600 Index lost 0.15 per cent to 274.50. Germany's DAX Index was down 0.02 per cent to 7,389.49, while France's CAC 40 Index plunged 0.62 per cent to 3,509.92.
© Dukascopy Bank SA