It has been a very busy morning with...>

BOND SUMMARY: It has been a very busy morning with volumes running substantially

above average with Bund, Bobl, Schataz and US 5y futures all running at double

their daily volumes, BTPs at over treble their daily volumes and US 10y futures

up 60% relative to their 5-day average.

- Coronavirus fears have escalated, with concern growing particularly over Italy

as 11 towns have now been placed into lockdown. This has raised concerns about

the spread of the virus through Europe, particularly as patient zero is unknown.

Concerns are also rising about the spread in South Korea, particularly in the

military given their mobility.

- Bonds have moved significantly higher. US 10y yields are at their lowest level

since July 2016 and 10y Bunds have touched -0.50% with the entire German curve

negative. Peripheral spreads have widened, led by BTPs with the BTP-Bund spread

11bp wider on the day which is currently at 145bp, the widest spread since

January.

- TY1 futures are up 0-20+ today at 132-16 with Bund futures up 0.71 at 175.64

and Gilt futures up 0.59 at 135.08.