UK gilts in safe-haven rally with Bunds as peripherals weigh

LONDON, Feb 5 (Reuters) - British gilt futures rallied in
early trade on Friday, pulled higher by Bunds, as worries about
peripheral government bonds continued to weigh and equities
plunged, encouraging safe-haven buying.

European stock markets were trading more than 1 percent
down, with the FTSE-100 index down 1.26 percent at 5,074.

By 0819 GMT, March gilt futures were 41 ticks up at 116.25
in line with the equivalent Bund.

The yield on ten-year gilts was more than 4 basis points
higher at 3.851 percent, widening the spread against Bunds to 73
basis points from 71 basis points on Thursday.

"The equity markets are looking at all the sovereign risk
and are falling sharply, so there's a lot of support for
government bonds," said Jason Simpson, strategist at RBS.

Investors are also taking risk of the table ahead of the key
U.S. non-farm payrolls report at 1330 GMT ECONUS.

--------------------- KEY MARKET DATA---------------------------
Long Gilt futures <0#FLG:> Gilt benchmark chain <0#GBBMK=>
Short Stg futures <0#FSS:> Cash market quotes <GB/GILT1>
Deposit rates DM= Sterling cross rates GBPX1=
UK debt speedguide <GB/DEBT> Econ. indicator polls<ECI/GB>
--------------------KEY MARKET REPORTS--------------------------
Gilts [GB/] Sterling [GBP/]
Euro Debt [GVD/EUR] Dollar [USD/]
U.S. Treasuries [US/] Debt reports [DBT]
-------------------- GILT STRIPS DATA --------------------------
Gilt strips data <GB/STRIPS1> All gilt strips <0#GBSTRIP=>
Gilt strips IO <0#GBSTRIPIO=> Gilt strips PO <0#GBSTRIPPO=>
A list of all the strippable British gilts <0#GBSTRIPTSY=>
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UK diary [GB/DIARY] Press reviews [PRESS]
New from Reuters [INFO]
Useful Speedguides REUTERS <PHONE/HELP> <USER/HELP>
(Editing by Andy Bruce)