Financials led the decline on Monday, bearing the brunt of Eurozone contagion fears. All eyes were on the bond market as yields on Italian and Spanish debt crept higher.ALL EYES ON BOND MARKETSThe Italian Treasury met its target after issuing €3bn in five-year debt today, and while demand improved, the yield was significantly higher than the previous sale, setting a new euro-era high in the process. The debt was priced to yield 6.29%, well above the 5.3% seen at the previous auction, a day after Mario Monti was named as the nation's new Prime Minister.Investec analysts Phillip Shaw and Victoria Cadman said "Although the new government is good news for Italy's medium-term sustainability, the more immediate concern is that bond yields continue to decline which will probably take further efforts by the ECB over the course of the week." Meanwhile, Christian Clausen, the president of the European Banking Federation, told Bloomberg that European banks should keep selling risky sovereign bonds. "The banks are doing exactly what they should be doing: they are reducing their risk toward this event. We can see that clearly as now Italian bonds are being sold off...They should keep doing what they are doing. The banks are actually moving out of the epicenter."Additionally, nerves were rattled by news that the spread between Spanish and German bond yields rose to a euro-era record of 428 basis points. The borrowing rate on 10-year Spanish bonds exceeded the 6% level for the first time in over three months.FINANCIALS DROP ON EURO CONCERNSInsurers and banking stocks were among the worst performers today. Life insurance peers Prudential, Legal & General and Resolution were among the heaviest fallers on the blue chip index, while Phoenix and St. James's Place took a hit on the FTSE 250. Barclays was a heavy faller after Goldman Sachs downgraded the stock from neutral to sell, anticipating difficulties with regulation to be enforced by the Independent Commission on Banking. RBS was also lower.Heading the other direction was ITV, Britain's biggest private terrestrial broadcaster, after reporting a 4% rise in revenues in the nine months to the end of September compared to the same period of 2010. Burberry was also in demand ahead of its first half results due in the morning.Vodafone, one of Britain's biggest companies, was on the up after being given a boost today after a positive assessment from the respected US business journal Barron's. The magazine argues that Vodafone is undervalued despite its sluggish performance in the last 12 months. Medical equipment manufacturer Smith & Nephew performed well, helped by Exane BNP Paribas which upped its recommendation on the stock from neutral to outperform. Premier Foods saw some volatile swings in its share price today. The company, which just last week was given a bit of breathing space by its bankers - deferring its end-of-year loan covenant tests by three months - was trading over 10% higher early on but swung back deeply into the red after UBS downgraded its rating to sell. BC