A Touch Softer On Weekend News, But Lacking Real Impetus

A lack of meaningful concrete developments re: some of the early risk-positive factors, namely the extension of Brexit discussions and the U.S. fiscal impasse, ultimately limited trading after the initial flurry of flow surrounding market re-opens. While the initial deployment of Pfizer's COVID-19 vaccine in the U.S. is a positive, that was at least partially negated by the aforementioned sources of uncertainty and short term COVID-19 pain, in addition to pockets of geopolitical unrest. That left T-Notes -0-04 at 137-31, a little off lows and within a 0-03 range after the small gap lower at the open, while cash Tsys have seen some light bear steepening, with 30s ~1.5bp cheaper on the day.

• As a reminder, the cash curve saw some light bull steepening on Friday, as the long end lagged the front end and belly, while U.S. equity markets unwound most/all of their early losses, in a session which saw focus continue to fall on well-known macro headline matters and the fiscal situation in DC.
• Eurodollar futures sit unchanged to 0.5 tick lower through the reds.
• A 7.5K sale of FFH1 headlined on the flow side during Asia-Pac hours.
• There is little of note on the local docket on Monday, which will likely allow focus to centre on the aforementioned, well-defined risk factors.