Risk assets in retreat while Tsys......>

US TSY FLOWS: Risk assets in retreat while Tsys trading around late overnight

highs on moderate volume (TYM>350k), narrow range after initial risk-off bounce

as US/China trade angst resumed Sunday (Trump gives China a month to agree on a

trade deal, threatens more tariffs; China blames Trump for trade set-backs).

- VIX rebounds (+2.70, 18.74) still well off last wk 4M highs (23.38); equities

weak (ESM9 -39.25, 2847.75) compares to Fri 2826.5L.

- Overnight flow includes misc acct selling strength in front end (fast$, prop,

swap), macro fund selling intermediates, bank and real$ buying long end. Light

Jun/Sep Tsy roll volume so far, TUM/TUU leads w/ >12k. Light deal-tied flow

after heavy issuance last week ($51.6B).

- Slow start for data, week ahead focus is largely on Wednesday with April

retail sales, industrial production and capacity utilization and May Empire

Manufacturing Index.

- The 2-Yr yield is down 4.7bps at 2.2191%, 5-Yr is down 4.9bps at 2.2148%,

10-Yr is down 4.1bps at 2.4263%, and 30-Yr is down 2.9bps at 2.8579%.