Spanish and Portuguese bonds fell below the benchmark German dams

Spanish and Portuguese bonds fell below the benchmark German dams, as divisions EU lawmakers set up a potential for the area eroded the confidence that may end the crisis in the region of the debt.

Spanish bonds fell five days last week after officials from Italy, Luxembourg, Belgium and Greece, said the common bond proposal should be explored, leading to resistance from Germany, France and Austria. German two-year notes slid as U.S. Treasury bonds fell amid speculation economic growth may hold up next year, and investors bid less debt than the maximum offered in the sale of 2,012 German titles.

"The total diversity of comments about 'E-bonds" really highlighted how far sometimes high-profile guys think, "said David Schnautz, fixed income strategist at Commerzbank AG in London." The sell-off walls containment due to side effects Treasury bond market. "

The performance of the Spanish 10-year bond rose to 5.42 percent yesterday afternoon in London, up from 5.08 percent on 3 December. The 4.85 percent securities maturing in October 2020 fell 2.515 or € 25.15 per 1,000 euros ($ 1.322) par value, to 95,685.

German performance two years rose to 1.08 percent from 0.86 percent, reducing the performance gap with 10 - year securities 187 basis points from 200 basis points on 3 December, and both as 208 basis points on 07 December.

European policy makers face in finding a solution to the debt crisis and pushed Ireland and Greece this year to seek international bailouts.

EU Summit

Lawmakers are under pressure to adopt new measures at a summit of 16-17 December in Brussels. French President Nicolas Sarkozy, said yesterday that "common bonds that make governments less accountable," join German Chancellor Angela Merkel, in rejecting the proposal.

Spanish bonds may fall next week amid speculation auction may highlight the growing concern about the debt crisis in Europe is deepening. The nation must be to sell bonds maturing in 2020 and 2025 on 16 December.

German bonds gave investors a profit of 6 percent this year, according to indexes compiled by us and the European Federation of Financial Analysts Societies. Spanish bonds gave investors a loss of 4.1 percent and Portuguese values fell 6 percent.