Worries over eurozone...
Euro and banks on alert as Italian PM resigns
Mr Renzi announced he would resign after the result, prompting a sharp fall in the euro against the dollar.
At one point the euro fell to almost $1.05 but it rebounded later to $1.06, or 0.96% lower than Friday.
Amid concerns over the future of the whole eurozone currency traders believe the markets have factored in the result into the price and that there is more likely to be a cautionary reaction rather than widespread panic.
Unlike the Brexit result in Britain and Trump’s election in Washington this result was expected.
Even so, the Italian economy is fragile and with 130% of government debt to GDP, one of the largest in the eurozone. The banks are badly in need of refinancing and their shares are expected to see a sell-off.
David Cumming, head of equities at Standard Life. said the key risk is “contagion” to the EU’s banks.
“It’s the banking sector people will be watching over the next few days,” he said.
Asian shares edged downwards overnight. Tokyo’s benchmark Nikkei 225 lost 0.82% by the end of trading. Hong Kong’s Hang Seng is down 0.67%.
Markets took some comfort from the defeat of Austria’s far-right presidential candidate.
The European Central Bank meets on Thursday amid much speculation it will announce a six-month extension of its asset buying programme and widen the type of bonds it can purchase.
In commodity markets, oil ran into risk aversion and some profit-taking after recording its best week in at least five years following OPEC’s decision to cut crude output.
Brent crude was down 42 cents at $54.08 a barrel, while US crude lost 38 cents to $51.30.