Tsys and Equities Bid Ahead Fri's Headline Employ Data

Still bid, late positioning helped Tsy futures climb off second half session lows, acct squaring up ahead Fri's headline employ data for July (+1.49M est vs. 4.8M for June). Uncertain relief bill negotiations also likely underpinned rates

• First half traded with a moderate risk-off tone, Tsys broadly higher (10YY managed new 5M low of 0.5019%) as Fed speak hampered stocks: Fed Barkin sees recovery as "less steep" while the economic "downturn is longer" while "fiscal stimulus is the right vehicle". Fed Kaplan said he is a "skeptic" on yield curve control but will keep an open mind on it.
• Rates gradually pared gains from midmorning into the second half, however, while equities rebounded on the back of news the State Dept has withdrawn curbs to ALL international travel -- boosting airline stocks.
• The 2-Yr yield is unchanged at 0.1171%, 5-Yr is down 1bps at 0.2137%, 10-Yr is down 1.2bps at 0.5362%, and 30-Yr is down 2.2bps at 1.1999%.