Italian 10-year bond spread with German bunds ends at highest since Feb 2014

Across global markets, assets seen as low risk such as highly-rated debt, gold and stable currencies like the Japanese yen were in demand, while stocks fell after the United States said it may authorise more strikes on Syria in a move that has escalated tensions with Russia.

Meanwhile North Korean state media warned on Tuesday of a nuclear attack on the United States at any sign of American aggression as a US Navy strike group steamed toward the western Pacific.

Traders also cited book-squaring on Italian bonds ahead of Wednesday's auction.