A risk-off session overnight was.....>

US TSY OPTIONS: A risk-off session overnight was mitigated a little at 0500ET on

news that China was offering an olive branch in the trade war with the U.S.

- Mar19 T-note futures up 9/32 at 120-165, having traded as high as 120-19

earlier before positive trade news out of Beijing.

- China's Ministry of Finance said it will cut tariffs on US-made cars to 15%

for three months, effective Jan 1, 2019. The move means the country will undo

the 40% import duty China imposed on U.S. cars in July as trade war escalated.

- Attention now on US decision on delaying tariffs that had been due on Jan. 1,

with an announcement expected on Friday.

- The 2-Yr yield is down 3.3bps at 2.7289%, 5-Yr is down 3.9bps at 2.7154%,

10-Yr is down 3.4bps at 2.8787%, and 30-Yr is down 2.8bps at 3.1418%.

- Weak Eurozone PMI data out earlier has helped boost bonds globally, as well.

- S&P Eminis a few points higher after the China news emerged, but down 0.87%;

dollar a little stronger amid EUR-GBP weakness, DXY up 0.44%.

- U.S. retail sales and industrial output figures to garner attention later.