Equity Bounce Tempers Tsy Risk-off Bid

Second half recovery in equities tempered strong risk-off action in rates in the first half Monday. No significant data -- geopolitical risk drivers.

• Session volumes were already robust on geopolitical risk tied to devolving US pullout from Afghanistan situation, remains strong with equities trading weaker after the bell. 10YY 1.2217% low; 30YY slips to 1.8843% low.
• Sources report real- and fast$ buying 10s and 30s, prop and fast$ selling 2s-5s over last 45 minutes. Modest pick-up in Sep/Dec Tsy futures rolling ahead Aug 31 first notice contributed.
• Bonds extended early curve flattening rally: Tsy 30Y futures made new session highs on the heels of large 5s/ultra-bond flattener's significant buy-through in the ultra-bond leg: ratio slightly over the CME's 6:1 spd ratio, closer to 7:1:

• -17,773 FVU 124-06.5, post time offer at 0927:25ET
• +2,565 WNU 199-23, well through the 199-17 post-time offer
• Data picks up Tuesday w/Retail Sales (-0.2% est vs. 0.6% prior), IP/Cap-U and Fed speak including Fed Chair Powell ahead Wed's FOMC minutes.
• The 2-Yr yield is down 0.2bps at 0.2052%, 5-Yr is down 2.6bps at 0.7473%, 10-Yr is down 2.8bps at 1.2483%, and 30-Yr is down 1.1bps at 1.9182%.