Risk-off day two, after the fall.......>

US TSY FLOWS: Risk-off day two, after the fall. Less hectic if not altogether

less painful session after the midweek rout in most asset classes (but equities

in particular). 

- At least Thursday's session traded with intuitive correlations, Treasuries

strong/extending session highs late as equities rout resumed late (S&Ps -1.24%,

DJIA -1.97%), Gold surged over $30 at one point, VIX surged nearly 6.0 to

session high of 28.84 before settling in late at 25.78. US$ receded for second

session.

- Early flow, sources note prop buying short end, bank and real$ buying

intermediates to long end. Heavy two-way across the curve from midmorning to

midday, rate buying surged late (heavy TYZ volume >3.5M late).

- Treasuries holding near highs after $15B 30Y auction trades through, awarded

3.344% rate (3.088% previous) vs. 3.352% WI; 2.42 bid/cover (2.34 previous).

Massive (near 1800 name) sell-program pushed eq's to new lows late.

- Tsy cash/ylds: 2Y 99-25.75 (2.846%), 5Y 99-14 (2.998%), 10Y 97-24 (3.138%),

30Y 94-04 (3.310%).