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Futures Lead The Bid


JGB futures sit 21 ticks higher than Friday's settlement at typing, with local equity markets struggling in the wake of Friday's Wall St. sell off (Nikkei 225 last -3.6%, below 28,000) & further downbeat assessments surrounding a lack of spectators at the Tokyo Olympics. The belly of the cash JGB curve led the rally as 7s richened by ~2.0bp, pointing to a bid that was perhaps driven by futures, with the wings of the curve hovering closer to neutral levels. Super-long swap spreads briefly tightened through recent tights.

  • Speculation continues to do the rounds re: the potential for the BoJ to step into the equity market and purchase TOPIX-linked ETFs given the sell off (TOPIX last -2.6%, a little off session lows).
  • 5-Year JGB supply headlines locally on Tuesday.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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