Monti hails Italy bond market achievement

Italian Prime Minister Mario Monti on Wednesday hailed a rally on the bond markets that brought down the differential between Italian and benchmark German government bonds to his target of half the level it was at when he came to power. "The spread today has finally reached 287 points," Monti, a former economics professor who is leading a coalition of centrist parties into a general election in February, said on Twitter. The spread, or difference in interest that Italy must offer on 10-year debt compared with German Bunds, narrowed to 285.6 percentage points. When Monti came to power in November 2011 amid a wave of financial market panic that threatened to bankrupt Italy, the closely-watched measure of investor concern had reached 574 points. Meanwhile Italian stocks surged on Wednesday by 3.81 percent on news of a fiscal deal in the United States which averted a combination of steep tax rises and austerity budget cuts for the world's biggest economy. The benchmark FTSE Mib index in Milan closed at 16,893.39 points, with bank shares leading the rally. Shares in Italy's second biggest bank, Intesa Sanpaolo, were the biggest winners of the session as they gained 5.77 percent. Former prime minister Silvio Berlusconi's media empire Mediaset also rose by 5.40 percent.