Not much to report from the EGB and.....>

EGB SUMMARY: Not much to report from the EGB and EUR rates space on Thursday as

the market waits for Draghi. EGB Yields opened higher following the partial

resolution to American debt ceiling but the Bund yield has been rather stuck

since.

- After the Spanish auction cleared, buying showed up in decent force for the

periphery. Portuguese debt forged a 5bp tightening in its spread to Germany and

Italian and Spanish markets were not far behind with 3bp of tightening. It was

like the market was waiting for the auction to put on the dovish ECB trades. 

- The other sensitive trade on ECB days is the 2Y German swap spread. Spreads

saw a big underperformance by German paper yesterday that gave way to a small

recovery today. 

- Although peripheral debt is performing well, the French market failed to

perform well in the aftermath of a lacklustre auction. It took about an hour

before OATs were able to make headway against German paper. 

- At present, the Bund yield is 0.5bp higher at 0.353%.