Analysts Warn to Be Careful About Jumping Into Spain

“Spain’s IBEX 35 Index may have been a laggard last year with a drop of 6 percent but since the announcement of the European Central Bank’s (ECB) bond-buying plan investors have returned to the country and the index has climbed 14 percent.

Analysts have declared that “the worst may be over” and a bailout is “off the cards” but Nicholas Spiro, managing director at Spiro Sovereign Strategy, told CNBC that significant “idiosyncratic” risks are being suppressed and warns of future flare ups.

The Spanish treasury completed another successful bond auction on Thursday with the improved sentiment allowing it to reach around 9 percent of its longer term borrowing needs for the year.

Yields on 10-year benchmark bonds even managed to creep below the 5 percent level last week for the first time since February 2012, well below the 7-plus percent seen in July….”

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