Bunds have started the week by giving...>

EGB SUMMARY: Bunds have started the week by giving back a portion of the large

gains of last week. Within the first hour of trading, the Sep-17 contract had

fallen below Friday's low of 164.19. The move is driven by a risk on sentiment

as the North Korean headlines have ebbed. 

- There is decent Bund contract activity this morning, which is running 47%

above the (rather low) 10 day average. However, the imminent approach of the

contract calendar rolls is assisting. Last trade for the Bunds etc is Sept 7 but

the roll will effectively be over at the end of this month. The Bund roll is

stable at 290 today.

- Sources say that initial selling this morning was concentrated in OATs.

- There is little in the way of data today aside from Eurozone IP data at

0900GMT, although the ECB also releases weekly information on QE purchases at

1345GMT and will provide an indication of the QE slowdown. The QE data shouldn't

be be market-moving.

- Germany issues a new 6m bubill this morning and France does the usual bill

auctions this afternoon but there is no bond supply this week.