Soon after the bond market open.........>

EGB SUMMARY: Soon after the bond market open yields started heading higher,

first in response to a number of USD swap paying trades in the 7-10Y area and

later a large Bund block trade: 6,519 RXM9 at 0914:01GMT. 

- Lots of activity in options on the Bobl contract, mostly downside trades that

temporarily cheapened the 5Y on the curve. 

- German, French and Spanish industrial production data all came on the weak

side of expectations for January.

- The US employment report saw strong payrolls and hours worked and outweighed

disappointment in avg hourly earnings.

- After several post-payroll oscillations, EGB prices settled little changed

from their pre-payroll levels. 

- Core-peripheral spreads quite stable. Bund-BTP 1bp tighter at 134.4bp,

although 10Y+ BTP and Bonos heavy ahead of considerable longer dated peripheral

supply next week. 

- 2Y Schatz is -0.2bp at -0.563%, 10Y Bund is +1.6bp at 0.644%.