[European market conditions]German government bonds fall due to the collapse of the coalition – wait for the FOMC and wait and see – Bloomberg

On the 7th, European financial markets took a wait-and-see approach ahead of the US Federal Open Market Committee’s (FOMC) announcement.

With Germany’s coalition government collapsing and Chancellor Scholz facing the possibility of a vote of confidence, the prospect of an early election led to a decline in German government bonds across all maturities. The yield curve of German government bonds has become bearish, with the 30-year bond yield rising 5 basis points (1 basis point = 0.01%) to 2.70%.

After the Bank of England’s Monetary Policy Committee (MPC) cut its policy interest rate by 25 basis points, as expected by the market, British bonds, mainly medium-term bonds, rose. The UK 10-year bond yield, which hit a one-year high of 4.59% earlier this week, fell 6 basis points to 4.50%.

European stocks rallied as traders awaited an expected rate cut from the FOMC.

The STOXX Europe 600 Index closed up 0.6%. The Bank of England warned of the possibility of higher inflation, weighing on Britain’s FTSE 100 index. In the STOXX 600 industry stock index, automakers rose, and mining also performed well. Health care, personal care, and communications stocks slumped.

Among individual stocks, shares of German utility company RWE rose. Activist investor Elliott Investment Management has acquired a significant stake in the company, prompting it to consider a share buyback, Bloomberg reports.reported. Banco BPM, Italy’s third-largest bank, also rose after announcing a takeover offer for wealth management service Anima Holding.

European market overview on November 7th (table as of 6pm in London)

STOXX European Stocks 600509.92+3.14+0.62%UK FT1008,140.74-25.94-0.32%DAX19,362.52+323.21+1.70%France CAC407,425.60+55.99+0.76%

KK	closing price	Compared to previous business day	rate of change

German government bonds 2-year 2.21%+0.04German government bonds 10 years 2.45%+0.04UK bonds 10-year 4.50%-0.07

bond	Latest yield	Compared to previous business day

原題：Bunds Drop, Gilts Outperform After BOE Cut: End-of-Day Curves

European Stocks Bounce Back as Investor Focus Turns to Fed, BOE

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