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Tsys trading modestly lower after......>

US TSY FLOWS
US TSY FLOWS: Tsys trading modestly lower after the bell, futures near middle of
range. Delayed react to lower Bunds, Tsys followed suit earlier, stops triggered
in former, already trading weaker on strong ZEW data. US$ slipped lower as well
w/VIX falling to near 6M lows as rates held range for couple hours. 
- China trade headline sensitivity underscored, VIX bounced off lows w/Tsys on
chatter China "walking back offers" VIX currently +.39 at 13.49 vs. 12.37 low
this morning. Yld curves reverse early steepening; US$ index off recent lows
(DXY -.158, 96.367 vs. 96.291L). Bid in SPX evaporates (-4.5, 2836.0) after
tapping 5+ month highs earlier.
- Trading/Prop accts two way in belly, better selling in 10s from real$.
Swap-tied buying 2s, selling in 7s, 9s and 10s. Option accts positioned for no
rate hike for next couple meetings at least
- On tap for Wednesday: MBA Mortgage Applications; crude oil stocks; FOMC policy
announcement followed by Fed chairman Powell news conference.
- Tsy cash/ylds: 2Y 100-02 (2.464%), 5Y 99-25.25 (2.419%), 10Y 100-04 (2.609%),
30Y 99-17.5 (3.021%).

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