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Large Bund put spread


Big selling hit Futures, on the European cash open


Some spillovers from Tnotes sellers

JGBS: JGB futures operated in a contained range in the morning session, going in
to the lunchbreak unchanged at 150.69.
- The cash space is mixed, lacking any firm direction, although the negative
tone from regional equities will be providing (at least some modest) support.
- Daiwa's Mari Iawashita believes that "uncertainty over what implications the
land-sale issue may have on Prime Minister Shinzo Abe's government and its
policies, particularly on the Bank of Japan, would weigh on sentiment for
government bonds." However, this hasn't played out over the last 1.5 sessions
with the Moritomo issue being outweighed by FY end flows & a favourable
supply-demand mix.
- Decent demand is expected at the upcoming 5-Year auction, with benchmark
5-Year paper ticking higher this morning.
MNI London Bureau | +44 0203-865-3809 |