LONDON: German Bund futures rallied at the open on Wednesday as losses in US and Asian stock markets and concerns about Spain fuelled demand for safe-haven paper before a sale of German 10-year bonds.
Germany will sell up to 5 billion euros of a bond maturing in 2022 in an auction that could be helped by a recent deterioration in sentiment towards riskier assets as the euphoria over plans for central bank intervention subsided.
Protesters clashed with police in Madrid on Tuesday as the government prepared to announce a new round of austerity measures to be included in the 2013 budget on Thursday, highlighting the challenges the country still faces as it mulls asking for financial help.
German Bund futures rallied 69 ticks to 140.75 as the S&P 500 suffered its worst day since June on Tuesday and as Japan's Nikkei share average shed 2 percent on Wednesday.
"Risk stocks are being smashed," one trader said. "I don't think there is any good news for Spain out there at the moment."
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