Greek yields rise on election fears

German 10-year yields were about three basis points from a record low on Tuesday, outperforming higher-yielding peers, as Greece’s failure to elect a president boosted the anti-austerity opposition’s chances of ousting the government.

Greek securities dropped as Prime Minister Antonis Samaras failed to get enough votes to install Stavros Dimas in a procedure that may still end up triggering national elections.

Greece’s five-year note yield increased 47 basis points to 9.04 percent and the rate on the nation’s 10-year bond rose 14 basis points to 8.46 percent.

“Investors have already priced in a lot of pessimism and uncertainty,” said Christian Lenk, a fixed-income analyst at DZ Bank AG in Frankfurt.

Polls show that SYRIZA, the opposition party that seeks a writedown on Greek debt held by the ECB and other creditors, would win a new election.

[Bloomberg]