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Italy's top financial index slides during trading Friday

Spread between Italian, German bonds narrows to 194 basis points

21 February, 18:46
Italy's top financial index slides during trading Friday (ANSA) - Milan, February 21 - As investors watched for the announcement of premier-designate Matteo Renzi's new cabinet, Italy's leading financial index showed small losses Friday.

The FTSE Mib ended the trading day slightly lower, falling by 0.30% to close at 20,391 points, as markets waited for news of Italy's third consecutive appointed cabinet in two years.

Sources said that Pier Carlo Padoan, chief economist of the OECD, will be named Italy's economy minister - a crucial job as the country struggles to emerge from its worst recession since the Second World War.

Padoan, a former economics professor in Rome who also worked for the International Monetary Fund, has served as deputy secretary-general of the Organization for Economic Cooperation and Development (OECD) since June 2007.

He previously served as an economics advisor to Italian premiers Massimo D'Alema and Giuliano Amato, in charge of international economic policies. Renzi's new cabinet will be presented to parliament on Monday and Tuesday for confidence votes.

On the Italian bond market, the spread between Italy's benchmark 10-year bond and its ultra-safe German counterpart closed at 194 basis points, slightly narrower than Thursday's 196 basis points, with the yield on Italy's 10-year paper ending trading at 3.60%, down from 3.64% one day earlier.

The spread between lending rates in the two countries is an important indication of investor faith in the Italian economy.

On other European markets Spain's IBEX 35 rose by 0.09%, closing at 10,071 points and Frankfurt's DAX jumped by 0.40%, closing at 9,656.95 points.

In Paris, the CAC 40 gained 0.59%, ending trading at 4,381.06 points, while in London, the FTSE index of leading British shares jumped by 0.37% on the day, closing at 6,838.06 points