French bond yields are too low given the economic challenges facing the country, a manager at one of the world's most influential bond investors said, a sign that some are taking a more critical view of the euro zone's second-largest economy.

Instead, Pacific Investment Management Co., which runs the world's largest bond fund, prefers short-dated bonds from Italy and Spain, two countries whose finances have been in investors' crosshairs but whose risks, at least in the short term, appear overstated, said Myles Bradshaw, a...