ETF Trends
ETF Trends

Exchange traded funds that invest in Italian stocks and government debt were under heavy selling pressure again Monday after steep declines late last week.

The iShares MSCI Italy (NYSEArca: EWI) was down nearly 6% in midday trading as the so-called bond vigilantes trained their sights on Italy and Spain. Government bond yields soared in the two Eurozone countries as the credit upheaval spreads from Greece. [Spotlight: Italy ETF]

Italian and Spanish bond yield spreads over German bunds jumped Monday to their widest levels since the inception of the euro, Dow Jones Newswires reported. There is a significant risk of Spain and Italy “being engulfed by the crisis,” a fixed-income strategist told the newswire service.

PowerShares DB 3x Italian Treasury Bond Futures ETN (NYSEArca: ITLT) was down more than 10% on Monday while PowerShares DB Italian Treasury Bond Futures ETN (NYSEArca: ITLY) also traded lower. [Sovereign Bond ETNs]

The exchange traded notes give investors leveraged or unleveraged exposure to the performance of an Italian bond futures index.

Markets in Spain were also under duress Monday — iShares MSCI Spain (NYSEArca: EWP) was down over 4%. [Spotlight: Spain ETF]

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