Italian bond yields jump as eurosceptic parties surge in election

Investors dumped Italy's government bonds on Monday and rushed to buy high-grade equivalents such as German Bunds after the weekend Italian election saw a surge in support for anti-establishment parties, led by the 5-Star Movement.

Italy faces a prolonged period of political instability after voters delivered a hung parliament in Sunday's election, spurning traditional parties and flocking to anti-establishment and far-right groups in record numbers.

The surge to parties sceptical of the EU could prove a setback to stable government and to wider European integration, investors said.

"It's not a positive result because we have seen the ascent of parties that create some