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Market lukewarm over Spain austerity measures

MADRID -- Investors are giving a lukewarm welcome to Spain's new austerity measures and bank stress test results aimed at convincing Europe Union authorities that Madrid is serious about managing its finances.

The interest rate for benchmark 10-year-bonds edged down 0.16 percentage points to 5. 83 percent Monday while Madrid's IBEX index was up 0.7 percent.

Spain has presented a draft 2013 budget that will make some (EURO)40 billion in savings while independent stress tests Friday showed its troubled banks will need to shore up their capital by some (EURO)59.3 billion ($77 billion), much less than the (EURO)100 billion in rescue loans granted by its eurozone partners.

On Monday, Prime Minister Mariano Rajoy meets European commissioner for monetary affairs Olli Rehn to discuss Spain's efforts to exit recession and reduce near 25 percent unemployment.