Treasuries rallied hard as London...>

US TSYS SUMMARY: Treasuries rallied hard as London came online this morning, and

while off best levels are still firmly in risk-off mode to start the week.

- Despite U.S. equity futures paring earlier losses, yields have failed to

follow suit, remaining near cycle lows.

- Trade headlines dominating, w China reaffirming defiant rhetoric over the

weekend, and Trump tweeting today that China is subsidising its exports.

- The 2-Yr yield is down 4.2bps at 1.8797%, 5-Yr is down 3.1bps at 1.8797%,

10-Yr is down 2.6bps at 2.0986%, and 30-Yr is down 2bps at 2.5483%.

- Though short-end is outperforming, notable that 30-Yr yields hit new cycle

lows (2.5204%), basically wiping out entire post 2016 election rise.

- New cycle lows hit in 3M/10Y (-27.806) and 1Y/10Y (-15.16) spreads.

- Sep 10-Yr futures (TY) up 10.5/32 at 127-2.5 (L: 126-23 / H: 127-10.5)

- ED futures off best levels but up 9.0-9.5 ticks in Mar20/Jun20.

- Fed's Quarles, Barkin and Bullard due to make appearances today. Earlier,

Fed's Daly reiterated that the Fed's patient stance is warranted (little new).

- We also get May ISM and Apr construction spending.