EGBs had a weak day, with no clear......>

EGB SUMMARY: EGBs had a weak day, with no clear driver for the broad-based

sell-off as the day went on. Bonds sold off alongside equity market weakness,

more Italian political noise, and concerns over the upcoming announcement by US

President Trump on the Iran deal, with no risk-off bid materialising in support

of EGBs. Jun18 bund futures last down 43 ticks at 158.88.

- Curve steepening the other theme, with 10-yr EGBs selling off and 2-yr hardly

moving. German 2s-10s last up 3.5bps to 113.58, and a little steepening on the

Euribor futures strip, as blues off 30-35 ticks and whites and reds basically

flat.

- Italian BTP 10yrs remain near day`s lows on early election concerns and

alongside bund sell-off.

- Particularly notable though is Italy's underperformance vs other peripheries,

with the 10s spread widening 6.2bps over Spain Bonos to 54.5bps, the biggest

daily move in that spread since the Italy March elections and one of the biggest

since 2016. That is a signal that amid a broader bond sell-off, idiosyncratic

political risks still the big driver for Italy.