JGB futures struggled during the morning.......>

JGBS: JGB futures struggled during the morning session, initially playing catch

up to the late rally seen in U.S. equities on Monday, before the latest round of

BoJ liquidity operations in the space saw limited demand of Y150bn. Yesterday,

an operation of the same size (Y500bn), saw oversubscription, with some Y571bn

worth of bids. Futures recovered from the fresh afternoon lows that were hit in

the wake of a soft round of 10-Year JGB supply, seeing fresh Tokyo highs.

Auction saw a much wider tail vs. prev., the lowest cover ratio for that tenor

at auction since 2016 and a low price that massively missed dealer exp., proxied

by a BBG poll (101.84 vs. exp. 101.97). Swap spreads were generally wider across

the curve, as the cash curve finished steeper on the day. Early comments from

FinMin Aso, carried by BBG, noted that policymakers are considering rolling over

loans for organisers of any events cancelled on the back of the coronavirus.

Elsewhere, PM Abe offered little new. Little new on the coronavirus front

either, outside of one delivery worker contracting the disease.

- Final services & comp PMIs due Weds, as is 1-5 Year BoJ Rinban ops.