Despite calling for greater............>

BOND SUMMARY: Despite calling for greater bipartisanship, President Trump's

State of the Union address failed to overcome the deep divisions between

Republicans and Democrats which could result in another government shutdown when

the current truce expires.

- US TSY yields have dipped lower this morning with the curve marginally

flattening. Current yield levels: 2-year 2.510%, 10-year 2.682% and 30-year

3.018%.

- JGB futures trade at 152.74 and 1 tick off the high.

- The German bund curve has steepened on the back of the longer-end selling off

slightly. 2s30s trades at 132.7 up from a low of 131.3

- French OATs have started on a stronger footing and the curve is 1-2bp steeper.

- Italian BTP yields have drifted higher, with the very long-end

underperforming. The 30-year trades at 3.691% up from 3.645%.

- Gilts opened stronger but subsequently sold off. Current yield levels: 2-year

0.733%, 10-year 1.2198%, 30-year 1.724%.

- Euro$ futures are 0.5-3.0 ticks higher with blues outperforming.