By Joseph Adinolfi, MarketWatch

Investors are concerned about a confrontation between Syriza and the troika

NEW YORK (MarketWatch) -- The yield on the 10-year Greek government bond climbed more than a full percentage point Wednesday, hitting its highest level since July 2013, on continued worries that Greece's newly elected government could force a showdown over debt relief with the country's lenders.

The Greek 10-year yield surged 103.5 basis points to 10.831%, according to Tradeweb data. The yield was at 10.731%, up 93.5 basis points from Tuesday's close, in recent trade.

U.S. Treasury yields, meanwhile, were generally lower as stocks climbed and as investors awaited the end of the Federal Reserve's two-day policy meeting and an expected statement on monetary policy.

Speaking to his new cabinet Wednesday, Greek Prime Minister Alexis Tsipras said he would move quickly to negotiate some form of debt relief with the International Monetary Fund, the European Central Bank and European Commission.

Tsipras said his administration won't continue with plans to privatize PPC, the country's largest power utility, and Piraeus Port, the country's biggest port. It also plans to increase the minium wage.

Investors worry that because of the coalition agreement between Syriza and the antibailout Independent Greeks, the two sides won't be able to reach a new agreement on how Greece will repay its loans, and the bailout will collapse, leaving Greece to default on its debt.

"The concern is that their coalition [with the Independent Greeks] is antiausterity," said Jonathan Rick, interest rate derivatives strategist at Credit Agricole.

Rick said the market is more worried that debt renegotiations will result in a recouponing or an extension in the maturity of Greek bonds, which it sees as much more likely than a Greek default.

The selloff in Greek debt had a spillover effect on the debt of other Southern European countries. The Portuguese 10-year government bond yield added 15 basis points to 2.363%, while the Italian 10-year gained five basis points to 1.588%.

In the U.S., Treasury yields initially moved higher in the global day, but money flowing out of European debt pushed yields lower by mid-morning in New York.

Also read: Doubts grow about mid-year rate hike, but Fed won't express any

Two-year bonds sold off ahead of an auction of $26 billion in two-year notes set for Wednesday afternoon.

The 10-year Treasury yield was down 3.1 basis points to 1.794%. The two-year yield was up 0.4 basis point to 0.514%.

Here's what Treasury investors were watching Wednesday:

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