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Free AccessMkts walked back wk opener Tuesday,....>
US TSY FLOWS: Mkts walked back wk opener Tuesday, risk-Off cooled slightly as
equities regained some ground (EDU9 +52.0 in late trade) after Mon's rout. Short
end underperformed while bonds see-sawed off lows to near middle of range,
decent volume (TYU>2M), yld curves flatter/off steeper levels in first half --
large TUU/TYU block underscored move.
- Short end under pressure all day as chances of 50bp cut at Sep FOMC cooled
- Heavy option and related hedging flow traded on day, bearish tone w/better
buyers downside puts, upside call sellers, though some ZIRP insurance hedging
persisted. Implied vols receded after surging Mon.
- Aside from pre-auction short sets, mkt took down decent amount of corporate
high-grade issuance, $13B Occidental Petroleum jumbo 10-tranche lead the days
supply, two-way rate locks/unwinds on day.
- Latest US Tsy $38B 3Y note auction (912828YA2) awarded 1.562% (1.857%
previous) vs. 1.563% WI, bid/cover 2.41 vs. 2.39 previous (3.05 avg).
- The 2-Yr yield is up 1.6bps at 1.5891%, 5-Yr is up 0.3bps at 1.5211%, 10-Yr is
up 0.5bps at 1.7124%, and 30-Yr is down 1.2bps at 2.2423%.
To read the full story
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.