A Touch Firmer As Chinese & HK Equities Struggle

Tsys have firmed at the margins in Asia-Pac hours, with TYM3 last +0-03 at 114-18, at the top of its narrow 0-03+ range, on light volume of ~41K. Cash Tsys run 1-2bp richer across the curve, with the intermediate zone outperforming.

• Tsys looked to weakness in Chinese & HK equities (centred on continued worry re: U.S. actions against the tech sector) and BoJ governor Ueda pointing to no imminent change in the Bank’s YCC settings for support.
• E-minis are lower in sympathy with Chinese tech equities, shedding 0.3-0.4%.
• Hawkish rhetoric from ECB’s Wunsch did little to impact the space, given his historical leaning and recent run of such comments.
• A quick reminder that the Fed is now in its pre-FOMC blackout period. Governor Cook offered the final round of Fedspeak ahead of the weekend, but was non-committal re: the May meeting, going over well-trodden areas of debate (banking stress, credit tightening, broad-based inflation and a resilient economy), pointing to a bumpy road when it comes to bringing inflation back down to target.
• Sellers of FVM3 108.00 puts provided the highlight on the flow side overnight, but those particular screen-based flows were comfortably under 10K on the volume side.
• The latest Ifo survey out of Germany and several rounds of ECB speak headline the European docket today. Meanwhile, activity indicators from the Chicago & Dallas Feds provide the highlight of the U.S. data slate.