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Italian markets

positive ahead

of election

MILAN: Italian financial markets were broadly positive on Friday as dealers cleared the decks ahead of Sunday's general election.

Bonds, futures and the stock market were tentatively firmer by mid-afternoon but traders said investors were minimising their risk by lightening long positions.

Many expect the result to be stalemate between the two major political blocs.

The lira was steady at 1,041.95 per mark in the pre-poll vigil with hopes that an interest rate cut was imminent providing inflation data showed price growth slowing.

The September 2005 fixed-rate government bond was 66 basis points higher on the day at 102.94 and the blue-chip Mib30 stock market index was 1.3 percent higher at 14,801 by 1430 GMT.

A Reuter survey of economists early in the week showed markets' preferred scenario was a clear win by the centre-left "Olive Tree" bloc rather than a centre-right Freedom Alliance victory.

Bank of Italy governor Antonio Fazio has said he wants inflation at four percent before a monetary easing.

Preliminary data for April from nine Italian cities, due on on Friday and Monday, are expected to show consumer prices trending lower from the 4.5 percent year on year in March.-Reuter