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Milan sheds 1.5% in trading amid concerns over Italy's economy

European markets weaken over fears of sanctions against Russia

14 March, 16:24
Milan sheds 1.5% in trading amid concerns over Italy's economy

(ANSA) - Milan, March 14 - Italy's main financial market fell by as much as 2% at one stage on Friday, driven lower - like many European markets - by uncertainty created from the crisis in Ukraine which could lead to sanctions against energy-exporter Russia.

Milan's FTSE Mib shed as much as 2% before recovering slightly to trade 1.32% lower by late afternoon, a loss of about 271 points to reach 20,320.75.

The Italian market was also weighed down by concerns raised by Fitch ratings agency, which warned that Italy's recovery over the next two years will be "modest", with 0.6% growth in 2014 and 1% growth in 2015.

In its Global Economic Outlook, Fitch said that Italian growth in 2014 will be primarily driven by the export sector while consumers will continue to keep their wallets closed.

Investors were also worried as Italy's public debt continued to rise in January, reaching 2.0895 trillion euros from 20.5 billion euros reported at the end of 2013, the Bank of Italy said Friday. Across Europe, stock markets were dropping to five-week lows as investors watched for the results of Sunday's controversial referendum that could lead to Crimea leaving Ukraine and joining Russia.

Shares in oil-service provider Saipem rose by 1.49% by late afternoon to 17.05 euros after reaching a two-billion euro deal with Russia's Gazprom on a gas pipeline project under the Black Sea.