An early Bund rally (albeit on v........>

EGB SUMMARY: An early Bund rally (albeit on v light volumes with the UK on

holiday) reversed substantially in the European afternoon alongside Tsy weakness

post-US Jobs data, and equities picking up steam going into the weekend.

- BTPs rallied all day ahead of Friday evening's ratings review by Moody's, with

catalyst seen as a leaked letter from the European Commission (out late

Thursday) on easing the usual conditions for ESM use amid COVID-19.

- No word yet from European Commission meeting this afternoon.

- ECB's Lagarde made opening comments at an event today but there was relatively

little of note on policy and markets suitably unmoved.

- Next week sees UK/EU future relationship negotiations, a variety of ECB

speakers (Lane, de Guindos, Mersch), and CPI/Q1 GDP/IP data. Latest levels:

* Jun Bund futures (RX) up 7 ticks at 173.96 (L: 173.8 / H: 174.24), with 2-Yr

yield down 2.2bps at -0.78%, 5-Yr down 1.4bps at -0.76%, 10-Yr down 0.7bps at

-0.552%, and 30-Yr down 1.3bps at -0.097%.

* Jun BTP futures (IK) up 79 ticks at 137.82 (L: 137.01 / H: 138.21)

* Italy / German 10-Yr spread 13.4bps tighter at 233bps