Courtesy of Mish.
Yesterday, Greek prime minister Antonis Samaras called a snap presidential election hoping to retain power even though he failed to deliver on his promise to end Greece’s €245bn troika-sponsored bailout.
Today, the markets threw a fit. Yield on the Greek 10-year bond soared from 7.258% to 8.17%. This is below the spike high on October 16, but the trend is clear. Yield is up 257 basis points (2.57 percentage points) since September 10.
Greece 10-Year Bond Yield
I commented on this on October 16, predicting snap elections: Greece 10-Year Bond Yield Soars to 9% as Prime Minister’s Gambit Explodes; Snap Elections Likely, and Opposition Syriza Would Win.
The hissy fit resumed today, following the actual snap elections announcement.
Athens Composite Stock Index
That was the biggest one-day decline since December 1987. Balk shares led the way. Attica Bank lost over 26% and Piraeus Bank declined 17%.
Exit Fears Once Again in Greece
The Financial Times reports Snap Election in Greece Reignites Fears for Eurozone
Greece’s political woes re-erupted as a threat to global financial stability yesterday, triggering the biggest drop on the Athens stock exchange since the 1980s and sending reverberations through world markets….
