Brexit is dominating the headlines.....>

BOND SUMMARY: Brexit is dominating the headlines. There have now been two

cabinet resignations this morning: the Secretary of State for Work and Pensions

Esther McVey and, more importantly, Brexit Secretary Dominic Raab. The loss of

Raab will not only make it more difficult for May to get parliament on board,

but could also trigger a leadership challenge.

- Gilts have rallied hard with the longer end outperforming the curve. The

10-year gilt trades at 1.381% from a high of 1.486% while the 2s10s spread has

narrowed to 67.6bps from 71.7bps.

- US TSYs are also bid, with the 10-year 5bps richer.

- JGBs are broadly unmoved. Current yields: 2-year -0.141%, 10-year 0.104%,

30-year 0.859%.

- German yields have pushed lower across the curve with the 2-year edging down

to -0.604% from -0.576% and the 10-year is down to 0.351% from 0.406%.

- BTPs have sold off since the open with the 2s10s 4bps steeper.

- Short sterling futures are down 15 ticks in greens/blues. Euroo$ futures are

off 1.0-4.0 ticks across the strip.