Tsys trading mostly lower into.........>

US TSY FLOWS: Tsys trading mostly lower into shortened pre-holiday session, long

end lagging on light volume (TYH<150k). Congress cleared stopgap spending bill

late Thu, funding US govt thru mid-Jan. Equities little firmer (emini +2.25,

2690.0), gold firmer (XAU +2.38, 1268.89), oil weaker (WTI -.42, 57.94).

- Asia, Tsys opened/held mildly lower levels on narrow range into London

crossover. Muted two-way flow included ASian end-user acct buying 5s, foreign

central bank buying 10s.

- London, continued to hold lower/narrow range, listless two-way trade and

flatteners fading current steepening on shortened pre-holiday session, trading

floors closing at 1300ET, Monday closed for Christmas. Portugal 10Y spd vs.

Bunds (+7.7bp) leads widening in sovereign spds, Spain 10Y +1.7 after Catalan

separatists won Thursday election, Spanish stocks weaker.

- Swaps, spds running marginally mixed in the short end to steady out the curve

on light curve  flow, 4s5s and 7s10s steepeners. No high grade corp bond

issuance/hedging expected.

- Eurodollar futures, steady/lower, 3M LIBOR +0.0112 to 1.6858% (+0.0745/wk).