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EGB/GILT: European govies have.........>

BOND SUMMARY
BOND SUMMARY: EGB/GILT: European govies have rallied this morning with markets
showing little difficulty in absorbing substantial supply from France and Spain.
Equities are rallying alongside broad FX strength versus the USD.
- The gilt curve has bull flattened with cash yields 1-3bp lower. The Sep-20
gilt future trades at 137.25, near the middle of the day's range.
- Bunds are similarly bid with the curve trading flat overall.
- OAT have marginally outperformed bunds with yields 2-3bp lower on the day.
Current yield levels: 2-year -0.3452%, 5-year -0.4979%, 10-year -0.0936%,
30-year 0.6404%.
- BTPs have similarly firmed with the longer end marginally outperforming.
- Supply today came from the UK (Gilts, GBP5.5bn), France (OATS, EUR11.75bn) and
Spain (Bonos/Oblis/OBLIEis, EUR6.75bn).
- Focus this afternoon will be on the US nonfarm payrolls report for June, which
follows in the wake of yesterday's substantial ADP revision for May.

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