German bunds recovered from the.........>

EGB SUMMARY: German bunds recovered from the morning lows and are up 21 ticks

from the close on Friday at 161.22. The rally can be attributed to a moderate

risk-off sentiment due to the Catalan referendum and the mass shooting in Las

Vegas where at least 20+ people said to be dead.

- As a result of the Catalan referendum, the Spanish 10-year benchmark yields

increase to session highs of 1.697%. The Bund-Bonos yield spread widening to

124bp which is 10bp+ higher on the day. Other peripheral markets have been

impacted by the Spanish move.

- Aside from the impact on Spanish debt, the euro has lost around 75 cents

against the dollar since Friday. There is considerable attention upon the euro

in the debt markets at present. In tune with the usual pattern in October, the

5Y German yield is performing strongest on the curve.

- In terms of Eurozone data, final Manufacturing PMI for September was revised

0.1 lower from the flash estimate to 58.1. The Eurozone unemployment rate for

August came in at 9.1%, which was slightly higher than expected.