Uncertain State Of Play Sees Bunds Drift

Bunds have continued trading within the morning ranges.

• The news that US President Trump and his wife Melania tested positive for Covid 19 has been at the forefront today. Election concerns and the uncertain state of play have been reflected in the markets with the lack of clear direction.
• US NFP saw a mixed set of data, with a miss on NFP, but higher revision. Unemployment fell to 7.9%, and on the margin, small better selling was noted in Govies on the data.
• Bund drifted lower during the US Equity cash open, as equity futures were lifted, following Nancy Pelosi, stating that they "will get something done on stimulus". With the long end underperforming, the German curve bear steepened, with 5/30s trading at 61.857.
• Semi core / BTPs had a strong positive session, pushing the 10yr German/Italy spread 2.8bps tighter. Nonetheless, Greece leads the way and 3bps tighter against Bund in today's session.

Latest levels:

• Dec Bund futures (RX) up 3 ticks at 174.69 (L: 174.6 / H: 174.97)
• Dec BTP futures (IK) up 45 ticks at 148.53 (L: 148.15 / H: 148.7)
• Dec OAT futures (OA) steady at at 168.77 (L: 168.7 / H: 169.01)
• Italy / German 10-Yr spread 2.8bps tighter at 132.9bps