EURO GOVT-German Bunds extend gains in short-covering move
LONDON Aug 6 (Reuters) - German Bund futures extended gains on Monday as dealers closed selling positions after the biggest daily sell-off on Friday since October 2011.
German Bund futures were up 58 ticks on the day at 143.54.
"We've seen some short-covering in Bunds after the sell-off last week, whereas the periphery is driven by what Draghi said - that he will focus on short-dated (bonds)," one trader said.
Two-year Spanish bond yields were down 22 basis points on the day at 3.52 percent, according to Tradeweb data, while Italian yields shed 19 bps to 3.09 percent.
Ten-year Spanish yields fell 12 bps to 6.81 percent.
ECB President Mario Draghi outlined a plan to buy debt in cooperation with the euro zone bailout funds on Thursday - but not before September, and only if countries ask to use the euro zone rescue funds and accept strict conditions and supervision. He said intervention would be focused in the short part of the yield curve.
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