Moderna Positivity, Veto Negativity

It has been a day dictated by two key events for EGBs so far.

• First, Moderna's vaccine showed an efficacy rate of 94.5% in its trials - slightly better than results seen from the Pfizer trial. However, in a big logistical difference, the Moderna vaccine can be stored in a conventional freezer for six months and then in a fridge for up to 30 days. This contrasts to the -70C conditions the Pfizer vaccine must be stored at. This saw Bunds sell off as risk rallied and peripheral spreads narrow. BTP-Bund spreads move to their tightest levels since mid-2018.
• Second, as noted in the 14:38GMT bullet, Poland and Hungary have vetoed the EU's long-term budget and Next Gen EU EUR750bln COVID recovery fund. This has seen Bunds and peripheral spreads reverse their earlier risk-on moves with most EGBs now fairly close to flat on the day.
• Bund futures are up 0.10 today at 175.04 with 10y Bund yields down -0.3bp at -0.552% and Schatz yields up 0.2bp at -0.732%.
• BTP futures are up 0.06 today at 150.65 with 10y yields down -0.7bp at 0.657% and 2y yields down -0.7bp at -0.375%.
• OAT futures are up 0.16 today at 169.70 with 10y yields down -0.8bp at -0.318% and 2y yields up 0.8bp at -0.678%.