Telecom Italia shares rise, CDS fall after Reuters debt interview
11.30.2010
Moodys senior European telecoms analyst told Reuters in a Nov. 30 interview that heavily-indebted Telecom Italias ratings and outlook were not at risk despite concerns over its mobile unit, thanks to its strong cash position and ability to meet debt-earnings targets. Deutsche Bank put out a research note on the comments and confirmed its buy rating on the stock the next day, which in turn spurred a 3.4 percent rise in Telecom Italia shares. Bloomberg and top Italian newspapers like La Repubblica, Milano Finanza andLa Stampa were among those that pinned the share rise to the Deutsche Bank research note on comments by Moody`s. A trader also told Reuters the shares had risen on a better outlook for debt — crucial for a company weighed by nearly 33 billion euros of debt. Five-year Telecom Italia credit default swaps also fell 12 basis points to a minimum just below 260 basis points.
