Feb. 26 (Bloomberg) -- BlueBay Asset Management Ltd., which oversees $47 billion, cut its holdings of Italian bonds after inconclusive results in the nation’s elections this week, according to Russel Matthews, a London-based money manager at the firm.
“We were hoping for, and expecting, a more benign outcome,” he said in a phone interview today. “This is a messy scenario and is going to provide some volatility in the markets over the next couple of weeks. We are now underweight on Italian bonds, after being neutral going into the election.”
Being underweight means owning a smaller percentage of the bonds than is contained in benchmark indexes used to monitor a fund’s performance.
Italy’s 10-year bond yield climbed 31 basis points to 4.80 percent as of 12:39 p.m. London time, after results showed pre-election favorite Pier Luigi Bersani won the lower house by less than a half a percentage point, while former premier Silvio Berlusconi gained a blocking minority in the Senate.
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