Nascent risk-on tone evaporated........>

US TSY FLOWS: Nascent risk-on tone evaporated late, rates inched higher as eqs

reversed course. Dead-cat bounce earlier (after Mon's sharp sell-off in

equities) added impetus from positive China trade noise from Trump advisor

Kudlow, EU/UK to discus Brexit draft agreement Wed (1400ET), large-ish buy

program >1280 stocks.

- Tsy yld curves mostly steeper as long end underperformed. Notable Large

5s/Ultra-bond steepener block in early trade: +39,682 FVZ 112-11.5, buy through

-10 post time offer, -7,235 150-04, post time bid.

- Slow data day, little substance from multiple Fed speakers w/Mn Fed Pres

Kashkari, Fed Gov Brainard, Philly Fed Pres Harker and Philly Fed Pres Harker.

Quiet US Tsy bill auctions: $164B total 4-, 8-, 13- and 26W.

- Rates inched off lows midday, gained traction as equities reversed, deal-tied

flow, prop and fast$ two-way in intermediates. Swap flow: receivers in 2s at

3.091%, payer in 4s at 3.13625%, two-way in 5s from 3.1394% to 3.13737%, 2s3s5s

receiver fly and 3s5s10s payer fly on modest volume. Tsy cash/ylds: 2Y 99-30.75

(2.891%), 5Y 99-15.25 (2.987%), 10Y 99-25.5 (3.147%), 30Y 100-02.5 (3.370%).