The overnight session saw risk taking...>

EGB SUMMARY: The overnight session saw risk taking make a gradual comeback and

Asian equities were headlined by a 1.5% rise in the Nikkei index. European

equities are also opening firmer today and the US high yield market continued to

recover from its lows at around 1500GMT yesterday. As a result, Bund yields are

marginally (0.2bp) higher today at 0.378%.

- There is very little movement in the core-periphery spreads with the exception

of a 4bp widening for the Greek 10Y. There is a small situation worth monitoring

with Italian lender, Banca Carige that is stumbling in putting together a

E560bln share sale.

- Today is a monster day for duration with French nominal, French linker,

Spanish nominals, a UK10Y, a BTP Italia and then tomorrow Italy follows with an

exchange of 2018/19 bonds into the BTP 5.75% 2033. As dealers set their hedges

for these auctions, it may create unexpected price action in the early European

hours.

- Data is highlight by the final Eurozone HICP release at 1000GMT.