Countries that perform well on environmental, social and governance metrics are viewed by investors as less likely to default, a new study that examined credit default swap spreads on sovereign bonds has found, the Financial Times reported. In an analysis of 59 countries between 2009 and 2018, Hermes Investment Management found that countries with the best ESG scores tend to have the lowest CDS spreads and vice versa, suggesting a link between credit risk and ESG performance.

Let this sink in for a minute: Yields on two-year Italian government bonds briefly fell below 0% on Tuesday. That's right - for a moment, investors decided it was just fine to pay Italy for the privilege of lending it money, even though barely a month ago the country was on the verge of a fiscal crisis so bad some wondered whether it would be need to leave the euro zone, a Bloomberg View reported. It matters little that yields ended the day on the right side of zero at 0.02%, but even that shows how the “greater fool” theory in markets has gone too far.

Funding Circle floated to much fanfare last September. It matches small businesses who want to borrow with investors looking for better returns than their cash could earn sitting in a savings account, the Financial Times reported. Shareholders may feel aggrieved about their returns however: shares in the lender are already down more than 60 per cent since its debut and fell another 25 per cent at the beginning of trading today. The reason for the sharp fall? Funding Circle warned this morning that revenue growth this fiscal year will only be half of what it previously expected.

Truworths International Holdings Ltd. fell the most in five months in Johannesburg as the South African retailer joined the ranks of those feeling the pain from the U.K.’s ailing shopping streets, Bloomberg News reported. Truworths said Tuesday British footwear subsidiary Office had started debt restructuring talks with its lenders in the face of the “depressed retail trading environment.” The stock slumped as much as 6.5%, the biggest drop since January, making it the second-worst performer among Johannesburg’s general retailers this year.

British manufacturers faced their worst month in six years in June, as companies and their clients continued to run down stockpiles amassed in the run-up to the March Brexit deadline, the Financial Times reported. The purchasing managers’ index compiled by IHS Markit, the research group, fell from 49.4 in May to 48 in June — the lowest level since 2013 — indicating that a majority of businesses had reported a fall in output for a second consecutive month. Production was the weakest since October 2012 and most companies reported job cuts for the third month running.

Spanish manufacturers reported tumbling orders and falling output as the eurozone economy continues to be hit by global trade angst and weakening growth, the Financial Times reported. The closely watched IHS Markit purchasing managers’ index fell to 47.9 in June, down from 50.1 in May. The figure was lower than the 49.5 forecast in a Reuters poll. A reading below 50 indicates a majority of companies reported falling output.

The risks to Ireland from a no-deal Brexit were outlined in stark terms as a top official warned that the country’s high debts had left it vulnerable to shock, the Financial Times reported.

Rome’s populist government has revised its ambitious spending plans in an effort to avert EU budget sanctions. Italy’s rising debt burden — at 132 per cent of gross domestic product the second-highest in the eurozone — is in breach of EU budgetary rules, according to an assessment by the European Commission last month, putting it at risk of becoming the first country to incur financial penalties, the Financial Times reported. Ministers reached an agreement on Monday evening on a law to adjust the budget in the hope of averting an excessive deficit procedure (EDP) by the EU.

Deutsche Bank AG’s efforts to turn around its struggling investment bank are gaining traction with investors, Bloomberg News reported. The cost of credit insurance on the bank’s riskiest debt fell for an 11th session on Monday, the longest streak of declines in more than two years, according to ICE Data Services. Swaps covering the bank’s safer bonds have also fallen to the lowest in months, the data show.

The eurozone’s annual rate of inflation stayed well below the European Central Bank’s target in June, ratcheting up the pressure on policy makers to provide more stimulus in an effort to prop up a faltering economy, The Wall Street Journal reported. Earlier this month, ECB President Mario Draghi signaled that the bank could roll out fresh stimulus as soon as July, prompting a rebuke from U.S. President Donald Trump, who accused the rate setter of seeking to weaken the euro. Mr. Draghi responded by insisting that the central bank doesn’t target the euro’s exchange rate.