European Bond Yield Summary 6/8/12

10-Year Yields:
Greece 28.93%
Portugal 11.23%
Hungary 8.40%
Spain 6.13%
Italy 5.75%
Belgium 2.95%
France 2.51%
Austria 2.21%

Netherlands 1.78%
Finland 1.63%
U.K. 1.61%
U.S. 1.57%
Germany 1.31%

Yields have moved lower for the troubled nations in the top list during this week, with the exception of Belgium, France and Austria that inched slightly higher the last few days. The perceived safer haven countries in the bottom list have all seen their yields move higher this week as money moved from bonds to stocks; a lower bond price corresponding to higher yields.

Spain and Italy are the key worries. A Spanish bailout is anticipated for this weekend.  The Spanish bank audits are scheduled to be released Monday so perhaps the news will be tempered if the Euro leaders can finalize a Spanish rescue plan during the pizza meetings this weekend.  The dovish, accomodative talk this week from the ECB, Fed's Yellen, and the China interest rate cut served to settle things down, bringing the risky nations' yields lower and the safer haven nations' yields higher. Chairman Bernanke's talk yesterday, however, or more correctly lack of talk concerning QE3, threw a wrench into the works, tainting traders' attitudes creating negative equity futures overnight.  Over the last few minutes, as this missive is written, the futures markets have staged a dramatic recovery. The S&P's were down over 10 handles only an hour or so ago, now down only a couple. Spain will provide high drama this weekend so check the news wires often as the hamburgers and hotdogs simmer on the grill.

Note Added 6/8/12 at 7:15 AM EST:  Spain 10-year yield is now 6.21% jumping higher ahead of the weekend drama.  Last week the yield was in the 6.50%-6.70% range so use that as your signal for major worries where significant stress will follow thru Europe.  Watch the 6.5% level and higher.