Core and semi-core EGBs soared as.......>

EGB SUMMARY: Core and semi-core EGBs soared as equities sank, with periphery

spreads widening alongside the increase in global risk aversion.

- The German Bund curve bull flattened, with 2-yr yields down 1.0bps at -0.648%,

10s down 2.7bps at 0.300%, and 30s down 2.7bps at 0.967%.

- French OAT spreads vs Bunds widened slightly (10-yrs out 0.9bps at 36.4bps),

but yields were lower across the curve, with 2-yr and 10-yr outperforming.

- Italian spreads got hit, with 10-yr BTP spreads vs Bunds hitting the widest

since the May political crisis at 286.4bps.

- The BTP curve has shifted higher in parallel fashion, with 2s through 10s

yields up 13bps. 10-yr yield at highest since May at 3.162%.

- Spanish, Portuguese, and Greek bonds are holding in better than Italy but

spreads are all wider, with 10-yrs out 3-4bps apiece against Bunds.

- Euribor futures saw an decisive bull flattening moves as the day progressed,

with short-end contracts down 0.5 ticks, and Blues down 2.0-2.5 ticks.

- A bit of EMU data tomorrow (German wholesale prices, Eurozone trade balance),

but most focus now on Turkey/EM and equities for direction.