By Martin Fell
Global stocks performed well this morning (Monday November 14th) on news that Italy had appointed a new prime minister – Mario Monti.
However, the gains appear to have been short lived and with no imminent resolution of the eurozone debt crisis in sight, it looks like the markets will remain in negative territory.
As well as a relatively straightforward handover of leadership in Italy, the markets were buoyed by the swearing in of new Greek prime minister Lucas Papademos.
Papademos is a former European Central Bank vice president and is expected to implement radical economic reforms in the stricken country.
Speaking to Reuters about the positive reaction of the markets, Mike Lenhoff, chief strategist at Brewin Dolphin, said: "We have now got two strong characters who are prepared to put public interest ahead of personal interest and they have a lot of goodwill to start with.
"The challenge for them now is to implement the fiscal austerity and budget reforms."
The FTSE 100, however, lost ground this morning, as investors reacted cautiously to the early-phase transitions of power in Italy and Greece. The main concern among investors appears to be rising Italian bond yields – which just last week were trading at an unsustainable seven per cent.