Bunds gapped higher on the open on......>

EGB SUMMARY: Bunds gapped higher on the open on the back of coronavirus

concerns. After retracing some of these gains ahead of early European trading,

Bunds started moving higher once more and have ground higher since then. At the

time of writing Bunds are trading at their highs of the day with 10y yields at

their lowest levels since November 1 having now fallen 23.5bp from the highs

seen two weeks ago.

- However, against this backdrop peripheral spreads are generally a little

tighter today. BTP and GGB spreads had tightened significantly this morning but

have since given back some of their gains. BTPs were driven by less political

concern following the weekend election results while GGBs helped by Fitch's

ratings upgrade. At the time of writing 10y BTP spreads are 13.5bp tighter on

the day while GGB spreads are 8.3bp tighter.

- Bund futures are up 0.83 today at 174.11 with BTP futures up 2.15 at 146.62

and OAT futures up 0.75 at 166.39.