Bonds: Yields diverge on either side of the Pond, against backdrop of international tensions

These were the movements in some of the most widely-followed 10-year sovereign bond yields:

US: 2.83% (+1bp)

UK: 1.43% (+0bp)

Germany: 0.58% (-2bp)

France: 0.82% (-2bp)

Spain: 1.38% (-2bp)

Italy: 1.99% (-3bp)

Portugal: 1.79% (-2bp)

Greece: 4.21% (+5bp)

Japan: 0.05% (-0bp)

Sovereign bonds on other side of the Atlantic diverged on Thursday, against a backdrop of simmering geopolitical and trade tensions.

Front and centre at the end of the week was the stand-off between the UK and its allies versus Russia, with Britain, the US, Germany and France calling on Moscow to explain its recent use of a military grade nerve toxin against a former spy living in London.

Meanwhile, overnight the White House clarified that it was asking China to cut its yearly bilateral trade shortfall with the States by $100bn.

In 2017, the Asian giant's trade deficit with the US reached $375bn, accounting for two-thirds of America's total deficit in trade.

That prompted a response from China's state-run tabloid Global Times, which said: "If the U.S. wants to reduce its trade deficit, it has to make Americans more hard-working and conduct reforms in accordance with international market demand, instead of asking the rest of the world to change."

Against that backdrop, readings on the Empire State and Philly Fed factory sector indices for the month of March validated the 14-year high reached earlier in the month on the key nation-wide ISM gauge, Pantheon Macroeconomics's Ian Shepherdson said.

"It was not a fluke. In short, the surveys signal that a robust manufacturing upswing continues unabated," he said.

Back in Europe, investors were digesting somewhat hawkish rhetoric from rate-setters in Norway and Switzerland, with rate-setters from the former country's central bank flagging the possibility of quicker rate hikes this year.

Similarly, following its own policy meeting on Thursday, the Swiss National Bank warned of the risk of a correction in house prices, saying it would continue to regularly assess the need for an increase in lenders' so-called counter-cyclical buffers.