Coiling Again In Asia

T-Notes held to a narrow 0-03+ range in Asia-Pac hours, shaking off continued regional worry surrounding trouble property developer China Evergrande/pressure on the Hang Seng & equity indices in mainland China. TYZ1 +0-01 at 133-13+, with cash Tsys virtually unchanged across the curve. A 5.0K block buyer of the TYV1 132.75/132.25 put spread dominated flow in the Tsy space, while the short end saw a 5.0K screen lift of the EDM2/U2 spread.

• To recap, T-Notes finished lower but off worst levels on Wednesday, as the contract held within the confines of Tuesday's range. Early trade saw the 5-/30-Year yield spread move to the flattest levels witnessed since August '20, aided by an FV/WN block flattener in Asia-Pac hours, before an uptick in U.S. equity markets, buoyant crude oil prices, an unexpected, notable uptick in the Empire manufacturing survey and a TY block sale (which appeared to be cross market vs. Bund futures) helped the space to finish lower on the day. Benchmark Tsys were little changed to ~1.5bp cheaper come the bell, with the belly leading the weakness. $IG issuance continued to tick over at a healthy rate.
• Thursday's NY session is set to bring retail sales data for August, the latest round of weekly jobless claims figures and the monthly regional m'fing survey from the Philadelphia Fed.