Eurozone periphery bonds trade lower tracking higher-than-expected June retail sales

The Eurozone periphery bonds traded lower Thursday tracking a higher-than-expected reading of the region’s retail sales for the month of June. However, a 6-month low composite PMI for July cushioned deeper fall in bond prices.

The benchmark German 10-year bond yields, which moves inversely to its price, rose nearly 1 basis point to 0.49 percent, the French 10-year bond yields also climbed nearly 1 basis point to 0.75 percent, Irish 10-year bond yields hovered around 0.78 percent, Italian flat at 2.01 percent, Netherlands 10-year bond yields higher by almost 1 basis point to 0.60 percent, Portuguese equivalents surged 1-1/2 basis points to 2.86 percent and the Spanish 10-year yields remained steady at 1.45 percent by 09:15GMT.

Retail sales in the euro zone increased by 0.5 percent in June on the month, the European Union's statistics office Eurostat said, well above market expectations of a 0.1 percent rise. As inflation slowed in June to 1.3 percent, showing little signs of a future rebound, euro zone consumers spent more than in May when retail sales went up by 0.4 percent.

The final IHS Markit Eurozone PMI Composite Output Index posted a six-month low of 55.7 in July, down from 56.3 in June and the earlier flash estimate of 55.8. The headline index has signalled expansion throughout the past 49 months.

Meanwhile, the pan-European STOXX 600 index rose 0.04 percent to 378.80, German DAX slipped 0.12 percent to 12,167.25, France’s CAC 40 up 0.21 percent to 5,117.75 and the PSI20 Index traded nearly 1 percent lower at 5,160.23 by 09:30 GMT, while at 09:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 65.74 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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