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Tsys trading higher but off.........>

US TSYS SUMMARY
US TSYS SUMMARY: Tsys trading higher but off safe-haven driven first half highs
as cooler heads try to calm mkt concerns over US/N. Korea tensions. Deal-tied
hedging, pre-auction sets reported ahead 10Y auction, results shortly. Limited
react to second tier data
* US Pres Trump "fire and furry" warning to N Korea, N Korea responded w/threat
against US strategically important island of Guam. Rush of short cover/outright
safe haven buying spurred best O/N volume of week.
* Long-end lead rally continued to extend new highs into the open, upside call
skew bid vs. corresponding OTM puts, decent volume on safe-haven bid. Real- and
fast$ buying, short covering in 10s to long end, props buying in 2s and 5s.
* Futures and cash market saw some mild intermittent profit-taking on risk-off
rally
* Swap spds forged wider earlier partly on supply-driven paying, pared move
w/Tsys off highs on otherwise quiet trade in the second half. Risk off
tone/wider spreads likely to hold in the short term.

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