This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Portugal Returns To Bond Sales With Strong Demand

By BARRY HATTON

LISBON, Portugal (AP) ⿿ Portugal sold its debt on financial markets Wednesday for the first time since it needed a bailout, collecting ⿬2.5 billion ($3.3 billion) in an auction of five-year bonds that was a milestone for economic recovery efforts in Portugal and the wider eurozone.

Treasury secretary Maria Luis Albuquerque said Portugal will pay interest of 4.9 percent on the loan ⿿ an affordable rate and a sign of returning market confidence in Portugal. She said investors placed orders for more than ⿬12 billion and 93 percent of the sold amount went to foreign buyers.

"This was clearly a significant step in the (bailout) program," Albuquerque told a news conference.

The sale was the latest sign that the 17-nation euro area is over the worst of its three-year financial crisis as borrowing costs have recently fallen in countries such as Spain and Italy, which were previously seen as risky investments due to their high debt burden.

Portugal was the third country, after Greece and Ireland, to fall victim to the eurozone's financial crisis when it required a ⿬78 billion lifeline in May 2011 to avert bankruptcy. Investors were alarmed by Portugal's meager growth and high debt and worried they might not get their money back if they loaned it money. That forced Portugal to ask the European Central Bank, International Monetary Fund and its European partners for help.

The country's fiscal health has improved since it began enacting cutbacks and economic reforms demanded in return for the bailout. However, the austerity measures are widely blamed for a forecast third straight year of recession in 2013 and a jobless rate of 16.3 percent.

Albuquerque said the Treasury didn't sell more bonds Wednesday because it doesn't need the money. The sale aimed to take the measure of market confidence in Portugal after it received broad praise for its obedient compliance with the terms of its bailout agreement. The three-year bailout program initially saw Portugal returning to markets only in September this year.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,271.49 +80.12 0.47%
S&P 500 1,999.74 -2.42 -0.12%
NASDAQ 4,622.7730 -15.2210 -0.33%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs