Off Lows As Wider Sell Off & European PMIs Impact

Weakness in wider core global FI markets factored in at the open, before the initial rounds of national flash PMI prints out of Europe provided mixed inputs.

• Futures trade as low as 96.92 before recovering to trade at ~97.15.
• The Feb low & bear trigger (96.81) remains unchallenged and intact.
• A breach there would expose the Dec 5 low (96.67), with the bears remaining in the driving seat from a technical perspective.
• Cash gilt yields are 0.5-3.0bp higher today, with 10s leading the sell off.
• Only 5s managed to register an incremental fresh YtD high during today’s initial sell off.
• SONIA futures are +0.25 to -6.5 through the blues, as the strip twist steepens.
• BoE-dated OIS shows 64-65bp of cuts through ’24.
• PMI data will continue to set the tone over the next ~45 minutes, with the UK readings due at 09:30 London.