Spain and Italy once again paid sharply higher yields than a month ago to sell short-term debt, indicating that euro-zone bond markets remain fragile despite last week's agreement on a second bailout for Greece.

Treasury-bill auctions in both countries were closely watched Tuesday for clues about the likely level of demand as Italy auctions bonds on Thursday and Spain sells debt next week.

Bonds from both countries came under heavy pressure prior to last week's Greek deal. Yields hit successive euro-era highs, fueling fear that the countries' funding costs would rise to unsustainable levels.

"It's not positive that they had to pay higher yields for the T-bills than previously but even after the Greek deal, the market wasn't very confident," said Alessandro Giansanti, senior rates strategist at ING. "These results indicate that both countries will have to pay jumping yields at their next bond sales."

Spain sold €2.885 billion in three- and six-month Treasury bills, near the €3 billion maximum it had intended. Bids totaled €9.305 billion, 3.23 times the amount of debt sold. The three-month average yield rose to 1.899% from 1.568% at the previous auction, on June 21, while the six-month average yield increased to 2.519% from 1.776%.