Global investing insights: Bond traders bet big on Europe

Strong US manufacturing data has been pushing equities higher – but safe-haven euro zone bonds are holding their ground, according to a Reuters report. That's reflective of a wider trend which is seeing money managers counting on bond prices climbing in European countries. Fuelling the trend is the European Union's planned issuance of €750 billion in bonds to fund its recovery programme, according to S&P Global Market Intelligence. One country that is particularly attractive is Italy. In spite of dodgy politics and an extreme debt burden, fact that Italy (and Spain) are still offering any positive yield may be enough to keep drawing investors. – Renee Moodie

Big bond traders double down on their bet on Europe

By Olivia Konotey-Ahulu and John Ainger

(Bloomberg) – Not even the calamity of disease, debt and Italy's fiscal woes are enough to stop the world's biggest money managers from a trade that's at the heart of Europe. Investors at Pacific Investment Management Co., Axa Investment Managers and AllianceBernstein Holding LP are counting on bond prices climbing in Europe's weakest countries, even with yields already hovering near all-time lows. In Italy, Europe's first epicenter of the crisis, bonds have rallied to pre-lockdown levels and the 10-year rate is now a paltry 1%.

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