The Europe problems have not gone away. Nothing has changed as 2012 is now underway. France auction today shows bidding relatively in line. Standard auction with no suprises. The France shorter-term 5-year yield is moving higer.
10-Year Yields:
Italy 7.04%
Spain 5.54%
Belgium 4.48%
France 3.32%
U.K. 2.02%
U.S. 1.96%
Germany 1.90%
France is back above 7%. Spain has now jumped 40 basis points since Tuesday. Yesterday there was talk that Spain approached the IMF concerning loans. France is inching up a hair each day, maintaining the 3.3% level or higher. Germany drops lower and may break the 1.90% level as money seeks safety and they are the best house in a bad neighborhood. Italy and Spain auctions are on tap for next week. The euro is dropping lower this morning after the France auction occurred at about 5 AM EST. Thus, remember the asset relationship; euro down=dollar up=commodities down=equites down=Treasury price up yield down. U.S. futures are currently down 11 on the S&P's.
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