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(U1) Uptrend Weakening


(U1) New Contract Low


High-Grade Debt Issuance

Brexit provides a busy session


A very busy early morning session for Bonds and EGBs.

  • Multi cross assets were all led after EU VDL told the EU Summit "no deal" was the likely option.
  • FTSE DAX, Estoxx, traded lower, with UK Bank stocks coming under pressure following the news.
  • The move provided some decent flattening in the German curve, long end led semi core higher, and Spain 10yr printed a record low yield at 0%.
  • Gilts and Short Sterling moved higher.
  • Gilt resistance is at 135.96 76.4% retracement of the Nov 5 - 11 sell-off (cont)
  • US Treasuries too their cue from EGB, curve moved bull flatter, and the long strip is underpinned, also helped, following the lack of an agreement on US stimulus.
  • Looking ahead, US PPI and Michigan are the data of note
  • Mar Bund futures (RX) up 49 ticks at 178.57 (L: 178.17 / H: 178.75)Germany: The 2-Yr yield is down 1.4bps at -0.78%, 5-Yr is down 1.6bps at -0.803%, 10-Yr is down 2.8bps at -0.631%, and 30-Yr is down 4bps at -0.226%
  • Mar Gilt futures (G) up 43 ticks at 135.85 (L: 135.45 / H: 135.9)UK: The 2-Yr yield is down 2.1bps at -0.136%, 5-Yr is down 2.6bps at -0.109%, 10-Yr is down 3.6bps at 0.165%, and 30-Yr is down 4.5bps at 0.699%.
  • US: 2-Yr yield is down 0.6bps at 0.131%, 5-Yr is down 1.9bps at 0.367%, 10-Yr is down 2.1bps at 0.8849%, and 30-Yr is down 1.5bps at 1.6118%.* Mar 10-Yr futures (TY) up 5.5/32 at 138-02 (L: 137-26.5 / H: 138-04)
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