Futures Weaker Overnight As US Tsys Take A Breather

In post-Tokyo trade, JGB futures are weaker, closing -11 compared to settlement levels, after US tsys weakened slightly as some air came out of Friday's post-Powell rally. With little on the docket until Thursday's claims data, 2- and 10-year US tsys finished ~2bps cheaper.

• There was also possibly some concession building ahead of the $183bn in auctions.
• SF Fed Daly sounded a little more cautious over the pace/size of rate cuts while generally echoing Chairman Powell's "the time is now" opinion from Jackson Hole. Economic data, particularly around the labour market, will determine the pace of easing.
• The market also took interest in oil prices after the exchange of missiles between Israel and Lebanon on Sunday. Prices nudged higher in Asian trading before surging after Libya said it would halt crude oil exports. Prices were up over 3%.
• Wall Street corrected from overbought conditions, with the S&P500 down 0.3%. It was weighed by falls across the mega-cap stocks, with some nerves heading into Nvidia’s earnings results later this week.
• Today, the local calendar will see PPI Services data alongside an Enhanced-Liquidity Auction for 15.5-39-year OTR JGBs.