Why would you say such a thing? The reasons why a real money manager would be underweight Italy are still very much valid. The fact that Italy has rallied 500bps changes nothing. In fact, if anything, it makes the case stronger.
LOL As a coincidence, "101" is the price of a BTP I'm looking at right now. BTP prices are back at the levels of april-may 2011 before the "crisis", are you guys sure this is a "rebound" or a "squeeze" ?
10y rallied not 500bps, only 250bps, but it has something left, you can catch it if you hurry. And maybe british newpapers didn't say anything, but something happened in Italy and in Europe in the last 6 months. Like a balanced budget in Italy, and a... 1 Trillion just printed by the ECB @1% for 3 years...
Of course it's a classic bond mkt squeeze... The funding risk premium has been removed, so the bonds are performing like there's no tomorrow. Nothing particularly unusual about that.
Yes, true, sorry... Been looking at the 5y, while writing "10y". And yes, something certainly did happen in Europe. Question is how much it's worth and whether it means people should be buying Italy here.
IMHO everything is about Europe's political future: Europe lasts -> buy Italy Europe breaks -> sell Italy BTW italian stock market had significantly underperformed other european markets until now, today I'm also enjoying a nice +2/+3% on my italian stocks, at last . Don't tell me I didn't warn you