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A warmer risk backdrop during the second....>

US TSYS
US TSYS: A warmer risk backdrop during the second half of the Asia-Pac session
allowed T-Notes to move away from Thursday's late session high, aided by a
6-month high registered in the Chinese Caixin services PMI, MOFCOM confirming
that China & the U.S. will hold vice-min level talks re: trade on Jan 7-8 & news
that the Japanese MoF, BoJ & FSA are set to convene re: financial markets (in
lieu of the FX flash crash). The former two pieces of news flow pushed U.S.
stock futures into +ve territory, weighing on Tsys. Curve bear flattened.
- Couple of block trades noted. TYG9 121.00/123.50 call spread 5.0K blocked at
1-46/64, sources point to a seller, followed by TYH9 120.50/121.50 1x2 call
spread 3750 blocked at 1-3/64. Elsewhere option flow favoured downside plays.
- White & red Eurodollar contracts trade 2.5-4.0 ticks lower on strong volume.
- NFPs, ex-Fed Chairs Bernanke & Yellen interviewing current Fed Chair Powell &
a meeting between Trump and congressional leaders headline Friday (Dem lead
house passed funding bill overnight that didn't include wall spending, Senate
won't vote on it, Trump would veto).
- T-Notes last 122.28, U.S. 10-Year cash Tsy yields last 2.582%.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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