Futures Weaker Overnight, A Typical NY Summer Session

In post-Tokyo trade, JGB futures are weaker, closing -10 compared to settlement levels, after a largely directionless NY session for US tsys. The news flow was light.

• The front end outperformed after cooler existing home sales and strong demand at the 2-year note auction. Primary dealers were allocated a record low as investor demand soared, with the bid-to-cover ratio at 2.81, the highest in roughly a year.
• US existing home sales were weaker than expected, down 5.4% m/m in June, the fourth successive monthly decline.
• The 2-year US tsy was 3bps richer at 4.49%, with the 10-year unchanged at 4.25%. The curve steepened to -24bps from -27bps.
• Later today the US calendar will see Wholesale/Retail Inventories, Flash PMIs and New Home Sales data alongside $30bn 2-year FRN Note and $70bn 5-year Note supply.
• The BoC meets today with a 25bp cut to 4.5% widely, although not universally, expected.
• US equity indices were slightly lower at the end of the NY session. However, after the closing bell, Tesla reported earnings per share of US52¢ v expectations of US60¢. Its shares were down more than 4% soon after. Alphabet reported slightly better than expected profit and revenue for the quarter. Its stock edged higher. (as per AFR)
• Today, the local calendar will see Preliminary Jibun Bank PMIs alongside 40-year supply.