LONDON, June 22 — Euro zone government bond yields were little changed today, with the market supported by news of rising coronavirus cases and hopes that changes to the composition of Germany’s top court could lead to less confrontation with the European Central Bank (ECB).

In a ruling last month, the Constitutional Court gave the ECB three months to justify bond purchases under its flagship stimulus programme or lose the Bundesbank as a participant, raising questions about the future of the euro.

But according to two sources, the appointment of a new court president and judge today could signal a de-escalation with the ECB.

A key change will be a new judge joining a bench widely seen to have a narrow Eurosceptic majority: Astrid Wallrabenstein, who was nominated by the pro-European Greens and has suggested there should be a thaw in relations with the European Court of Justice, which cleared the ECB’s plan.

Analysts said the move would be positive for euro zone bond markets, long underpinned by massive ECB asset purchases.

In early trade, yields on higher-rated euro zone bonds such as Germany, France and the Netherlands were all little changed on the day.

Germany’s benchmark 10-year Bund yield traded at -0.42 per cent, not too far off recent three-week lows.

The World Health Organisation meanwhile reported a record increase in global coronavirus cases yesterday, with the total rising by 183,020 in a 24-hour period.

The news kept alive concerns about that a second wave of the virus the could further hurt the world economy, bolstering demand for safe-haven debt such as German bonds.

European equity markets opened lower, while Italian bond yields were steady .

"We have serious reservations about the sustainability of rising market optimism when it hinges on the lack of lockdown response to the epidemic,” ING analysts said in a note.

"At some point, either more drastic measures will be imposed, or consumers will stay home. Neither would look good for risk markets.” — Reuters