In a wild session Thursday, EGBs saw....>

EGB SUMMARY: In a wild session Thursday, EGBs saw sharp gains upon the ECB

decision, which were swiftly reversed in Pres Draghi`s press conference.

- Even w no action today, EGBs flew as market keyed on statement indicating that

a major easing package would be delivered at the Sep meeting.

- But Draghi in presser said there was little concern over Eurozone recession,

and no discussion of rate cut today (despite being partially priced in).

- Sep Bunds traded in a 143 tick range (L: 173.49 / H: 174.92) on good volume

(850k+ as of 1530BST). German curve steepened sharply after earlier flattening.

- Periphery EGB spreads tightened sharply then widened past pre-ECB levels.

Notably, Italy / German 10-Yr spread 2.8bps wider at 189.9bps.

- Meanwhile, talks in Spain to form a government collapsed. SPGBs still

outperforming Italy on the day by 4bps (on 10-Yr).

- Latest futures prices:

* Sep Bund futures (RX) down 30 ticks at 174 (L: 173.49 / H: 174.92)

* Sep BTP futures (IK) down 47 ticks at 139.76 (L: 139.22 / H: 141.6)

* Sep OAT futures (OA) down 19 ticks at 166.23 (L: 165.67 / H: 167.29)