A protestor holds up a placard outside the Catalan region's economy ministry building during a raid by Spanish police on several government offices, in Barcelona, Spain, September 20, 2017. Photo: Reuters/Albert Gea

Spanish 10-year bonds ended a two-day rally on Wednesday, after Catalan separatist leader Carles Puigdemont said he would release a statement at 9 pm this evening, Bloomberg reports.

The yield on the benchmark 10-year notes rose to the highest level since July, while the country’s stocks fell the most among European markets, tumbling more than 2%.

The course of events surrounding Sunday’s referendum, as Spengler wrote for Asia Times on Monday, has shown that chances of Catalan independence are far and away more real than what was priced into the market. Investors were assuming that because the referendum was unconstitutional nothing would come from it.

“Until there is more clarity, or at least more priced into the bonds that suggests we may have gone too far, you would expect some continued aversion in the market,” Toronto-Dominion Bank strategist Richard Kelly was quoted by Bloomberg as saying. “That could last a day, a week, or a month. It just isn’t clear again what the next step is in the process.”

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