Tsys trading weaker by the bell,.......>

US TSY FLOWS: Tsys trading weaker by the bell, near session lows tapped around

late morning, curves bear steepening but off highs by the close. Little react to

Construction Spending (+0.1% vs. +0.4% expected), ISM PMI Index (61.3 Aug VS

58.1 Jul) and light vehicle sales (EX-GM CAR SALES AT 2.8M).

- Continued US$ strength, dollar index off highs DXY +.326, 95.466

(95.138L/95.737H), $/Eur off -0.0041 at 1.1578, $/Yen near highs +.42 111.48;

equities weaker/near lows (emini -7.0, 2895.0); Gold weak (XAU -8.42, 1992.57);

West Texas crude on lows late (WTI -0.63, 69.17) after rally to late 2014 highs

(71.40) on back of Iran supply squeeze, tropical storm Gordon concerns.

- Early Knee-jerk selling in long end post data, extends session lows, curves

making new highs/steeps. Program sellers, prop & fast$ buying on dip, futures

rebounded briefly as sellers reloaded, session lows around late morning.

- Big jump corp issuance after weeks of muted issuance, over $10B Mon, estimates

running over $50B w/Cigna planning over $22B jumbo issuance to help finance

acquisition of Express Scripts. Tsy cash/ylds: 2Y 99-30 (2.653%), 5Y 99-28.75

(2.770%), 10Y 99-26 (2.895%), 30Y 99-25.5 (3.061%).