Euro Zone Bonds Steady Amid Risk-Off Market Sentiment

Euro zone government bond yields were stable as risk-off sentiment continued after a stocks sell-off driven by high tech valuation concerns. Strong euro zone PMIs indicated economic growth, with German services showing significant expansion. ECB interest rate decisions and U.S. data scarcity add to market uncertainty.

Euro zone government bond yields remained stable on Wednesday as market participants focused on strong euro zone PMIs. This occurred amidst ongoing risk-off sentiment, following a stock sell-off caused by concerns over high tech valuations.

German 10-year Bund yields showed minimal change, while two-year yields, which closely track shifts in inflation expectations and monetary policy outlook, also remained steady.

Economic data revealed euro zone expansion at the fastest rate since May 2023, with notable growth in the German services sector. Meanwhile, the ECB maintained its interest rates, while leaving the door open for future adjustments.

(With inputs from agencies.)