Coronavirus treatment optimism ends Bund rally – Reuters


* Government bonds from the periphery of the euro area give tmsnrt.rs/2ii2Bqr

By Yoruk Bahceli

AMSTERDAM, Aug.24 (Reuters) – German safe haven bond yields rose after their longest decline this year as risk appetite on Monday as hopes for a coronavirus treatment boosted risky assets.

Global stocks rose on Monday after the U.S. Food and Drug Administration cleared blood plasma from recovered patients as a treatment option for the coronavirus.

German 10-year safe-haven yields rose about 1 basis point to -0.50% early in the session after falling for six consecutive sessions last week, the longest decline since January.

The yield on Italian 10-year bonds fell 2 basis points to 0.99%.

Without any data release to move the market on Monday, attention turned to a speech by Federal Reserve Chairman Jerome Powell on Thursday, where he will discuss revising the bank’s monetary policy framework.

Later Monday, investors will watch the European Central Bank’s weekly publication of the breakdown of its conventional bond buying programs, which have remained subdued in recent weeks during summer trading.

“The Bund is back on a more bullish path, and that will likely remain biased into the start of the week. The market is looking at what will happen in September, and in EGBs (European government bonds) that will mean supply, but also the ECB becoming more active with its QE (quantitative easing) programs, ”analysts said. from Mizuho to customers.

“This recovery is more likely during the first week of September than the next one, but the market will anticipate this purchase.”

The 10-year Bund yield fell below -0.50% last week after remaining above that level for nine days as investors developed risk aversion.

On the primary market, Belgium is expected to reopen a 10-year bond by auction.

Reporting by Yoruk Bahceli, editing by Larry King

Our standards:Thomson Reuters Trust Principles.

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