Trader Talk

As the world watches Ukraine, Europe sneaks in the back door

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Message to markets: It's not just Ukraine.

Although Portugal's issues have been well publicized, this morning Italy said its second quarter growth contracted by 0.2 percent year-over-year, on top of an 0.1 percent decline in the first quarter indicating the country slipped back into recession and ending the new prime minister's honeymoon.

In other words, things are a real mess again in Europe. Both Portuguese and Greek markets have swooned by more than 3 percent, and the other countries are down about one percent. The is languishing near a nine-month low against the dollar, in the wake of data showing German industrial orders tumbled at their steepest rate in almost three years.

It's just the continuation of an ugly trend in the past four weeks since the Ukraine crisis heated up:

Portugal -17.9 percent

Greece -12.3 percent

Germany -9.3 percent

Italy -9.2 percent

-7.2 percent

France -6.3 percent

UK -3.8 percent

The S&P 500 Index is also down 3.2 percent in the same period.

This is likely causing some flight-to-safety to the U.S., including Treasury bonds, and it is likely one of the reasons that yield on the 10-year have remained low. In fact 10-year yields dropped to their lowest levels in a year this morning.

--By CNBC's Bob Pisani