Market Round Up: Italian Showdown 💥 Big Short Is Back 🙊

by | 5 Nov, 2018

 

1. Italian Showdown

Italy and Brussels will go head-to-head this week over a budget dispute that looks set to get nasty if either side cannot start to see eye-to-eye.

Last week the European commission rejected Italy’s 2019 draft budget which called for tax cuts and a minimum income for the unemployed, both of which would increase Italy’s deficit (which is pretty big already).

In response to the breach of EU debt guidelines, the EU has threatened Italy with potential fines, the freezing of EU funds and bond-sale monitoring if they fail to get their deficit under control – here come the big guns.

However, Italy’s deputy prime minister, Luigi Di Maio, believes that a deal will soon be reached and that Italy’s controversial spending plans could become “a recipe” for reviving European growth. Let’s not all hold our breath.

The battle has put considerable pressure on the euro which has seen some choppy trading throughout October, and may continue if common ground cannot be found between the squabbling parties.

 

2. Big Short Is Back

Steve Eisman, famous for predicting the collapse of the subprime mortgage industry in 2008 which was turned into the hit movie, ‘The Big Short’, has revealed that he is shorting two UK banks over Brexit.

Eisman did not mention the banks by name, but did announce that he expects the UK to make an agreement to leave the bloc, but that parliament would reject it after that, sending the country into a downward spiral of uncertainty. Scary stuff to say the least, but this time people are paying more attention to him.

Investors are beginning to speculate that the two most shorted banks in the FTSE 350 index, Metro Bank and CYBG, may in fact be his targets.

Tesla has also been placed in Eisman’s crosshairs as he criticised Elon Musk’s ability to follow through on his vision and lofty ambitions, saying he will continue to short Tesla going forward.

Good Luck, Tesla – let’s see if Musk can come out on top!

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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