The Italian stock index in Milan is moving up quite smartly and is a fine trading opportunity. Not only for the short term but likely for the longer term as well. This is due in some measure to the upcoming election prospects in March. Italian politics are notoriously convoluted and inefficient. They are riddled with special interest and the electoral system itself is stacked against making changes and progress to protect vested interests. Looks like the model the US has adopted, but that’s another story. What could be buoying the markets is the prospect, the likelihood of which is anyone’s guess, but the possibility distinctly exists, that a change in this mish mash of vested interests and archaic rules may be in for a change. The leading party at the moment, the Five Star Movement, barely polling 30%, (no party ever wins anything close to a clear plurality in Italy at least since the days of Caesars Julius and Augustus.) Despite the obstacles to progress, the mere possibility of change, remote as it seems to be now, is a great encouragement to the Italian stock market and likely the greater EU as well. Let us not forget that the Italian economy is nonetheless the eighth largest in the world with a GDP of 1.82 trillion dollars right below India and right above Brazil. She is a heavyweight economy with EU wide influence. Watch for developments in this important country and her upcoming elections and watch her markets because carefully.
Two Up and Two Down in Global Industrial Action
Daily Analysis - 08/01/2018