- The fragile truce between the US.....>

BOND SUMMARY: - The fragile truce between the US and China over the trade war is

already fraying following the arrest of Huawei's CFO. US TSYs have rallied this

morning with the 2-year yield pushing down to 2.758% from 2.811%.

- JGB futures trade at 151.67 from a morning low of 151.49.

- German bunds initially sold off but have pared losses, with the long-end

outperforming. The 2s10s spread has narrowed to 85.8bps from a high of 88.1bps.

-  French OATs have rallied with the 2-year yield trading at -0.479% from a high

of -0.469% and the 10-year trading at 0.658% down from 0.675%.

- Alongside the risk-off tone in equities, Italian yields have drifted higher

with the longer-end leading the charge. The curve is broadly 2-3bps steeper.

- The backlash over the government's handling of the legal advice on Brexit and

the issue of the Irish backstop continues to build heading into the 'meaningful

vote' in parliament next week. Gilts have lacked direction with trading in a

relatively tight range.

- Euro$ futures are up 3.5-6.0 ticks. The Euribor futures strip has flattened

slightly with greens/blues up 1.5-2.0 ticks.