EGBs traded slightly weaker at the......>

EGB SUMMARY: EGBs traded slightly weaker at the open but have hardly looked back

since despite a strong showing in the equity markets too. The 10Y Bund yield is

2.1bp lower at 0.741%, which put the yield in the lower half of the weekly range

of 0.72-0.79%. 

- Citi have recommended pulling the trigger on European debt markets and

Barclays recommend going long Treasuries. These reports appear to have fallen

upon receptive ears.

- The only data of note were weak UK retail sales numbers that also helped push

EGBs higher.

- A couple of OAT block trades have shown up and because of early outperformance

of the 15Y sector of the curve, it is a fair guess that French life insurance

was buying early today. 

- However, the peripheral markets are stronger than the core, led by a 14bp

decline in the enormously volatile Greek market. Bund-BTP and Bund-Bonos spreads

are 2.3bp and 3.3bp tighter respectively.

- Much talk of limited supply next week, even if Belgium or Spain are included.