Treasuries ended Tue lower but......>

US TSYS SUMMARY: Treasuries ended Tue lower but mildly off session lows after

solid $24B 3Y sale offset corporate rate-lock tied pressure amid heavy

high-grade corporate bond issuance, such as $17.25B eight-part British America

Tobacco debt deal. 

- Treasuries cut loss in early afternoon after strong 3Y auction stopped thru to

 1.520%; strong 64.05% indirects, good 10.2% directs, leaving only small 25.79%

for dealers (least since Nov 2009.) 

- Tsys lifted off late morning low amid risk-off bid (somewhat due to N.Korea

nuclear worries), which helped Yen gain vs US$; earlier firm US$/yen weighed on

Tsys. Flows had modest bank portf., real$ sellers in 10Y, 30Y Tsys, prop on

small 5Y, 10Y vs. 30Y steepeners. Deal-tied hedges and pre-3-yr auction shorts

set. British Amer. Tob. cld do GBP or EUR debt Wed. Tsys had better buyers in

front end out to 5Y notes. 

- EURODLR FUTURES: Mildly lower across the strip.

- TSYS 3PM ET: 2Y 1.639%, 3Y 1.511%, 5Y 1.834%, 7Y 2.096%, 10Y 2.282%, 30Y

2.867%.