Not the most exciting of trading........>

EGB SUMMARY: Not the most exciting of trading sessions as the market seemed to

almost brush aside the confused German political situation. 

- Initially, Bunds performed well on the back of the inability to form a German

government. Yet, that move was fairly limited in duration and the Bund price

quickly slipped lower to where it closed on Friday. the 10Y Bund yield is almost

unchanged Monday at 0.361%. 

- Slovakia added to the growing list of countries that have completed their

funding for the year, selling E230mln combined of 8Y and 20Y debt. Demand was

very strong for the 20Y and bodes well for the 10Y Finland being sold tomorrow.

- In the afternoon, the German President announced that he wants the various

parties to attempt a coalition again and remember their responsibilities. This

was not an unexpected as a step and does not preclude eventually heading to new

elections after many months.

- Soon after the German President was speaking, we heard of several hundred

million of 5Y BTPs being sold. However, this appeared to be absorbed fairly well

and the Bund-BTP spread headed into the close 1.6bp tighter.