Bond yields slip ahead of elections
GERMAN government bond yields slipped yesterday, pulled down by a decline in US Treasury yields before key midterm elections. Italian yields also eased from session peaks, with the eurozone seen as unlikely - for now - to punish Rome for its draft budget.
US 10-year yields fell 2.5 basis points, keeping below 3.2pc, after soft manufacturing numbers and jitters that a strong showing by the Democrats in today's vote would hinder US President Donald Trump's tax-cut agenda.
Opinion polls suggest Democrats will likely take control of the House of Representatives, while Republicans should hold their Senate majority.
The global backdrop was also not conducive to risky securities, amid doubts over mooted China-US trade talks and signs that the years-old rally in tech shares may be unravelling. That kept yields on German and US government bonds - seen as safe assets - below highs touched after Friday's upbeat US jobs figures.
"We are gearing up for the political events ahead, so Treasuries are a bit higher," Crédit Agricole strategist Orlando Green said.
"One would imagine that if it goes the Democrats' way, there could be a stalemate in terms of Trump's tendency to loosen fiscal policy - so there may be a bit of nervousness about that," he added.
In Dublin, the Iseq Index of Irish shares lost just over half of 1pc, closing at 6191.37. Glanbia was the best performer on the day in rising 2.64pc, while Aryzta lost almost 4pc ahead of a looming capital raise that was barely approved by shareholders last week.