Spain

EMERGING MARKETS

Chairman of Goldman Sachs Jim O'Neill has said Spain's stricken economy may not need a full bailout, despite yields on Spanish bonds continuing to soar to eye-watering levels in recent weeks.

M&G's Michael Riddell has put 10% of his International Sovereign Bond fund portfolio in Italian government bonds in anticipation of a fresh liquidity injection from the European Central Bank.

Spain has sunk further into recession, after official data showed its stricken economy shrank by 0.4% in the second quarter of this year.

European stocks are climbing after a four day sell-off, following a pledge from European Central Bank president Mario Draghi that the ECB will "do whatever it takes to preserve the euro".

Investment bank Citigroup has forecast a 90% chance Greece will leave the euro in the next 12 to 18 months.

LGIM's head of European equities Gavin Launder has argued the three-month long short selling ban imposed on Spanish securities will have no material impact on the market.

Markets dipped into the red this afternoon after a weaker start in the US, as a round of poor corporate updates weighed on investor sentiment, compounding eurozone fears.

Italian and Spanish authorities both moved to ban short-selling today after shares plunged across the globe on fears Greece will fail to meet bailout pledges.

Investors have had to reassess their strategies to stand out from peers in recent months, as range-bound markets play havoc with long-held approaches.