Mario Monti’s first full day as Italy’s prime minister will be dedicated to trying to persuade lawmakers in Rome and investors everywhere that he can pass the measures needed to cut the euro region’s second-biggest debt.
Against a backdrop of 10-year bond yields above the 7 percent threshold that led Greece, Portugal and Ireland to seek bailouts, Monti, 68, unveils his government’s economic plans. He will present the program to the Senate in Rome at 1 p.m. before a confidence vote beginning at 8 p.m.
Oil Declines; Asia Stocks Pare Losses
Oil fell from a five-month high as concern increased that Europe’s debt crisis may spread and China’s central bank said it’s not ready to loosen inflation controls. Asian stocks swung between gains and losses and U.S. equity futures climbed.
Crude slid 0.4 percent to $102.23 a barrel as of 3:05 p.m. in Tokyo, after reaching $102.89 yesterday. The MSCI Asia Pacific Index swung between a loss of 0.8 percent and a gain of 0.3 percent. A gauge of Chinese shares lost 0.4 percent. Standard & Poor’s 500 Index futures climbed 0.5 percent ahead of data that that may show increased manufacturing in the Philadelphia region.
U.S. Banks Face Europe Contagion Risk: Fitch
U.S. banks face a “serious risk” that their creditworthiness will deteriorate if Europe’s debt crisis deepens and spreads beyond the five most-troubled nations, Fitch Ratings said.
“Unless the euro zone debt crisis is resolved in a timely and orderly manner, the broad credit outlook for the U.S. banking industry could worsen,” the New York-based rating company said yesterday in a statement. Even as U.S. banks have “manageable” exposure to stressed European markets, “further contagion poses a serious risk,” Fitch said, without explaining what it meant by contagion.
The “exposures” of U.S. lenders to major European banks and the stressed nations of Greece, Ireland, Italy, Portugal and Spain, known as the GIIPS, are smaller than those to some of the continent’s larger countries, Fitch said.
