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There has been a distinctly risk-off feel to markets this morning with Bund futures surpassing Thursday's highs while Treasury and gilt futures are close to Friday's highs. Eurozone peripheral spreads have widened across the board.

  • Equities are in the red across the board with the DAX down around 2% and the Hang Seng closing down more than 3% lower. Evergrande seems to be driving the market moves today.
  • Today's calendar is fairly light with German PPI having come in higher than expected while the ECB's Schnabel and Villeroy are both due to speak. However, markets are already looking ahead to Wednesday's FOMC meeting where there will be particular focus on the dot plot with the addition of 2024 for the first time.
  • TY1 futures are up 0-7 today at 133-00 with 10y UST yields down -2.8bp at 1.336% and 2y yields down -0.2bp at 0.222%.
  • Bund futures are up 0.46 today at 171.46 with 10y Bund yields down -2.9bp at -0.310% and Schatz yields down -1.3bp at -0.725%.
  • Gilt futures are up 0.36 today at 127.30 with 10y yields down -3.1bp at 0.814% and 2y yields down -1.7bp at 0.270%.