German Bunds turn lower, UK bonds drop

Monday, 04. February 2019 18:03

Investors in Europe were looking for safe havens on Monday toward the end of the session, mostly turning to cash instruments amid a selloff in oil futures. Benchmark German and British sovereign bonds tumbled, sending yields higher. The euro and the pound posted losses after Sentix measured the worst investor sentiment in four years and construction growth in January in the United Kingdom came in at the lowest point since the contraction in March. Gold and silver were modestly under the flat line.

Stocks in London were underpinned by the depreciation, as weaker sterling buoys companies which lean on foreign income, but the FTSE 100 ended only 0.2% in the green, while indexes in the Eurozone closed modestly below the flat line.

As German bonds surrendered earlier gains, the two-year note yield was slightly up at a negative 0.569% at 6:01 pm CET. The measure for the 10-year Bund added 1.1 basis points to reach 0.179%, compared to a small rise to 0.78% for the 30-year bond. Equivalent futures slipped 0.02%, 0.14% and 0.17%, respectively. British yields grew two points to 0.79% for the two-year maturities and the yield on the 10-year gilt was up 2.8 points at 1.172%. The 30-year yield surged 3.7 points to 1.786%.

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