JGB futures pulled back sharply in the.........>

JGBS: JGB futures pulled back sharply in the afternoon, finishing -19 on the

day, well shy of the early highs, with little in the way of obvious catalyst

(some pointed to focus on tomorrow's 10-Year JGB supply, although it may have

just been a product of the bounce in risk appetite), and despite the BoJ's

liquidity pledge/first Gensaki op since 2016 (making it hard to square with the

bounce in equities). To recap, the BoJ noted that "Global financial and capital

markets have been unstable recently with growing uncertainties about the outlook

for economic activity due to the spread of the novel coronavirus. The Bank of

Japan will closely monitor future developments, and will strive to provide ample

liquidity and ensure stability in financial markets through appropriate market

operations and asset purchases.

- The belly has underperformed on the sell off, after the aforementioned

statement supported the space in the Tokyo morning.

- On the local data front, Q4 capex and corporate profits were weak in the wake

of the latest sales tax hike. Final m'fing PMI was little changed vs. flash.

- The aforementioned 10-Year supply headlines tomorrow's local docket.