Bonds sell off as Euribor spreads continue to rise

As the market opened we saw bonds selling off, with the Bund hitting 122.60 in early trading. I was somewhat surprised to see the long end sell of in Euribors soo aggressively, with spreads moving upwards fast along the curve. In the Jun10-Sep10 spread, I went short the previous high of 22.5 to then see it go up to 23, then 23.5. I added a bit more at 23.5 before managed to be small up on the pullback. Further down the curve the Dec10-Mar11 spread initially fell, to 18s from 19s before then going up to 20s. Longer end euribors sold off much more relative to front months as the market is expecting the ECB to continue cutting rates in the short term.
Bonds actually reversed as the day went on, and continued its disconnect with equities as the Bund finished close to the high of the day along with equities.
Tech shares fueled the gains for stocks, with the Nasdaq now flat for 2009. GM paced the Dow Jones with a 14% rise. Apparently they are likely to be given another life line, in my opinion the whole structure and management have to change to change the fortunes for GM. We are in a changing world, and they have been one of the slowest to react to the change, i'll be surpised if they manage the turn around, but we can hope!
Have Stocks risen too far too fast? Well with GDP US final at -6.3% and no real signs of things improving, even though they haven't got any worse, its hard not to see another shot to the downside.