Day two of the risk-off show, fear.....>

US TSY FLOWS: Day two of the risk-off show, fear of virus pandemic leaves no

profit unturned. The session didn't start that way, with equities recovering

slightly after Mon's rout in early trade. Early risk appetite brief as Tsys

powered higher on back of a second consecutive 2.5% decline in equities, 10- and

30Y ylds falling to new all-time lows (10YY 1.3055%; 30YY 1.7852%).

- FED'S CLARIDA: TOO SOON TO SPECULATE ON COVID-19 IMPACT, doesn't stop

speculators from paring risk

- Massive futures volumes (TYH>5.4M) as Mar/Jun rolling kicked into high gear.

US Tsy $40B 2Y note auction was expected to place strong, but rally stymied

hopes as note tailed 0.016, awarded a 1.188% rate (1.440% last month) vs. 1.172%

WI, bid/cover 2.45 vs. 2.65 previous.

- Early rate sales evaporated, sources noted real$ and bank selling 10s-30s

early turned two-way into late morning. Contributing to latest surge higher in

rates, 30YY move below 1.790% (1.7852% low) spurred some convexity acct buying

in long end. The 2-Yr yield is down 3.9bps at 1.2084%, 5-Yr is down 5.1bps at

1.1591%, 10-Yr is down 4.3bps at 1.3271%, and 30-Yr is down 3.7bps at 1.7977%.