Greek Bonds Slump on Election Risk Fueling Gains in German Bunds

Greek government bonds fell, pushing the yield on three-year notes to the highest since they were sold in July, as Prime Minister Antonis Samaras failed in his final attempt to get his candidate for president confirmed.

Italian bonds declined and Greek stocks tumbled as the result of a vote by lawmakers paved the way for parliamentary elections in the nation that triggered Europe’s sovereign debt crisis. Under the Greek constitution, the legislature will now be dissolved, and Samaras said he will ask for voting to be held on Jan. 25. Germany’s 10-year yields fell to a record alongside those of Austria and the Netherlands as investors sought the safest fixed-income assets.