European stocks have stopped the last two weeks rally as new debt concern in Spain arise.
Indexes are not panicking. Investor are feeling reassured after the ECB has decided to take action. This could just be a bump on the road. How big will the bump be ? Everybody will be asking just that.
The Spanish government was certain before that it wouldn’t need a bailout. Like most governments has failed to recognize the need for help and has fell to take bold actions to improve the situation. The Spanish government is now divided between those on favor of partial bailout and those how prefer to wait for an improvement.
Markets wont be holding on and will certainly no wait for the Spanish government to agree in a resolution. Most investor will be reducing theirs position as a precaution or even cashing on last two weeks profits.
The longer the Spaniards take to agree in a way out, the sooner the rally to recovery can resume. In the meantime no much movement will be expected in the coming days.