Better Bid On Questions Re: The Passage Of Biden's Support Plan

U.S. Tsys have rallied during Asia-Pac hours with the move extending further in the wake of U.S. President elect Biden's address re: his COVID support plan (which was initially outlined in the NY-Asia crossover). There was nothing in the way of surprises within the plan given the countless source reports released on Thursday, perhaps allowing the extension of the early sell the rumour buy the fact theme in the space after Biden's address came to an end. Now questions surrounding the prospect of the support package's passage through the Senate are at the fore i.e. will members of the more moderate Democratic wing support the scheme, if not it may be watered down. T-Notes last +0-06 at 136-24, a touch back from best levels of the day and still within the confines of yesterday's range, while cash trade sees bull flattening, with 30s sitting a little over 3.0bp richer vs. the close. Flow was also supportive. With a 10.0k block buyer of the TYH1 137.50 and 138.00 calls, which appeared to be new bullish positions for the timezone, and smaller block buying of FVH1 futures.

• JGB futures stuck to a narrow range, with early afternoon trade seeing the strong cover at the 5-15.5 Year JGB liquidity enhancement auction provide support, although there was only a brief breach of the overnight/Tokyo morning highs, with futures now back from best levels of the day, last +4.
• Aussie bonds drew support from the impetus in Tsys, with the AOFM's issuance update also providing some support. The typical weekly bond issuance notional guidance was lowered owing to the well ahead of task run rate (which was expected), while no imminent ACGB Nov '32 syndication and confirmation that particular line will represent the only new launch during the remainder of the current FY also provided support. YM +1.0, XM +1.5. Pricing of corporate deals provided nothing in the way on tangible pressure for the space.