2-year and 5-year yields are up by about 10 bps
It doesn't look like it's taking much to spook investors on the day. It's all about Italy right now and markets will be focused on whether or not the budget meeting will yield a positive or negative outcome. That's all you have to worry about.
Talks of the budget being delayed and what not is negative in the sense that the government is unable to strike a compromise to announce a deficit or plans that will amount to a target of less than 2%.
With Italian bonds suffering, it's spilling over to the euro and of course risk assets in general as bank stocks are weighed down as a result of this. This may be something to look out for even in US trading later as budget talks appear to be in limbo at this point.
