MILAN (Reuters) – The main measure of Italy’s borrowing costs broke above 6 percent for the first time in 14 years before easing back on Tuesday as the euro zone’s third largest economy was sucked into the bloc’s debt crisis.

Italian 10-year yields at one stage soared more than 30 basis points on the day to leap above 6 percent — the highest since 1997 — getting closer to the 7 percent level most market players see as being unsustainable for Italy’s borrowing costs given its huge debt pile.

MILAN, July 11 (Reuters) – Italian government bonds and
stocks fell sharply on Monday as investors cut their exposure to
Italy on fears the euro zone’s third biggest economy could be
sucked into the bloc’s sovereign debt crisis.

The premium investors demand to hold Italian paper rather
than low-risk German debt rose to a new euro lifetime high,
pushing up financing costs for Italy — which has one of the
highest public debts in the world — and its banks.

MILAN (Reuters) – Shares in UniCredit SpA (CRDI.MI: Quote, Profile, Research, Stock Buzz) and other Italian banks extended losses on Monday after a sell-off last week due to concerns Italy could be drawn into the euro zone debt crisis and worries about the strength of their capital.

UniCredit, Italy’s biggest bank by assets, turned negative after seesawing in early trade and was down 0.7 percent at 1.22 euros by 1123 GMT, adding to a 20 percent drop over the past week.

MILAN (Reuters) – Angry supporters of Silvio Berlusconi’s Northern League allies blame the scandal-hit prime minister for the center-right’s crushing defeat in local polls and many now say the party should pull the plug on his coalition government.

“The real question is: has the alliance with Berlusconi become too costly for us?” said Giacomo, one of many Northern League voters flooding a call-in program on the party’s Radio Padania Libera to vent their fury at the election result.

MILAN/ROME (Reuters) – Credit ratings agency Standard & Poors cut its outlook for Italy to “negative” from “stable,” citing weak outlook for growth and reduced prospects for slashing its debt mountain.

The downward revision, which raises the risk of a downgrade of Italy’s sovereign rating, may heighten fears that contagion from Greece’s and other European countries’ debt crisis could be spreading to the euro zone’s third-largest economy.

ROME, May 17 (Reuters) – Prime Minister Silvio Berlusconi
was “surprised and saddened” after his centre-right bloc lost
ground in local elections and was forced to trail in a run-off
in his powerbase, financial capital Milan.

Milan’s centre-right mayor Letizia Moratti won 41.6 percent
of the vote in elections on May 15-16 against 48 percent for her
rival Giuliano Pisapia, giving the left a chance to win for the
first time in nearly 20 years in a run-off in two weeks.

ROME, May 17 (Reuters) – Prime Minister Silvio Berlusconi
was left “surprised and saddened” after his centre-right bloc
lost ground in local elections in a string of Italian cities and
was forced to trail in a run-off in the financial capital Milan.

With 90 percent of votes counted late on Monday, Milan’s
centre-right mayor Letizia Moratti had 41.5 percent support
against 48.1 percent for her rival Giuliano Pisapia, giving the
left a chance for an historic win in the run-off vote in two
weeks’ time.

ROME (Reuters) – Prime Minister Silvio Berlusconi looked set to suffer a big defeat Monday as early results from local polls raised the prospect of his Centre right losing a string of key cities, including the financial capital Milan.

With some 33 percent of ballots counted, Milan’s Centre-right mayor Letizia Moratti had 41.6 percent support against 48.1 percent for her Centre-left rival Giuliano Pisapia.

ROME (Reuters) – Italians began voting for a second and final day on Monday in local elections that will test whether a sex scandal, three corruption trials and a faltering economy have weakened Prime Minister Silvio Berlusconi.

Nearly a quarter of Italians are casting their ballot in 1,310 towns and 11 provinces in the first two-day round of an election that will be wrapped up in a run-off on May 29 and 30.

ROME (Reuters) – Italians vote for a second and final day Monday in local elections that are a test of whether a sex scandal, three corruption trials and a faltering economy have weakened Prime Minister Silvio Berlusconi.

Nearly a quarter of Italians are casting their ballot in 1,310 towns and 11 provinces. The most significant races are in the four big cities of Turin, Naples, Bologna and Milan — Italy’s business capital and Berlusconi’s home town, where his centre-right coalition is at risk of losing for the first time in nearly 20 years.