US TSYS GAIN DESPITE 3% GDP: EYE TRUMP/POWELL, SPAIN/CATALAN,

     US TSYS SUMMARY: US Treasuries rose Friday on speculation that US Pres.

Trump would chose Jerome Powell as his Fed Chair, which the market viewed as

relatively dovish in comparison to the other front-runner, Stanford Univ's John

Taylor. Trump will announce his choice before the Nov. 3rd start of his Asian

trip. 

- Such speculation overcame earlier bond weakness amid firmer 3% 3Q GDP and, and

2.2% GDP price index, 1.3% Core PCE Price Index, traders said. 

- Tsy futures had heavy sales in TYZ 10Ys from 124-11.5 down to 124-09. Buyers

then stepped in at the lows after softer 100.7 Oct. BBG/Univ of Mich consumer

sentiment. Prop and fast$ bought intermediates; real$ bought 10Y as bounce

gained traction. More buying on softer US$ vs. Yen. Asian buying also came into

Tsys. 

- Other factors supporting rates: news that Catalonia officially declared

independence from Spain, said traders. Tsy futures also saw heavy buying in TYZ

from 124-16 to 124-19. 

- Tsys pared gains in afternoon, with, position square into weekend; next week

FOMC; Nov. Tsy options expire Today. 

- Tsys 3pm ET: 2Y 1.599%; 3Y 1.731%; 5Y 2.041% 7Y 2.272%; 10Y 2.426%, 30Y 2.935%

US TSY FUTURES CLOSE: Trading stronger be the close, off top end of range. Tsy

futures finally gained traction/held gains after choppy start to session, 10Y

yld 2.426% vs. session high of 2.475%. Gold, oil and equities all trading higher

by midday (emini currently +16.25, 2577.75). Current futures levels:

* Dec Ultra bonds up 21/32 at 162-29 (161-22L/163-03H)

* Dec 30-yr Bond futures up 14/32 at 151-05 (150-10L/151-10H)

* Dec 10-yr futures up 7.5/32 at 124-19.5 (124-06.5L/124-22H)

* Dec 5-yr futures up 4.5/32 at 117-01.25 (116-25.25L/117-03H)

* Dec 2-yr futures up 1.25/32 at 107-21.75 (107-19.25L/107-22.75H)

US EURODLR FUTURES CLOSE: Finish stronger, off top end of range after early chop

following GDP data. Modest volume for most part while EDZ8 leads w/462k by the

bell. Current White pack (Dec'17-Sep'18):

* Dec'17 +0.000 at 98.485

* Mar'18 +0.010 at 98.350

* Jun'18 +0.015 at 98.235

* Sep'18 +0.020 at 98.150

* Red pack (Dec'18-Sep'19) +0.020-0.035

* Green pack (Dec'19-Sep'20) +0.035

* Blue pack (Dec'20-Sep'21) +0.035

* Gold pack (Dec'21-Sep'22) +0.035

US SWAPS: Spds finish steady/mixed after reversing early narrowing to mildly 

wider midday. Modest mixed flow on net includes:

* $240M payer 5s, 2.1215%

* $170M receiver 7s, 2.255%

* $240M payer 5y, 2.1475%

* $240M payer 5y, 2.1555%

* $170M payer 7y, 2.28438%

* 5y/6y steepener after 5y/7y fattener

Latest spread levels:

* 2Y -0.06/22.69

* 5Y +0.12/7.50

* 10Y -0.25/-2.88

* 30Y +0.00/-29.50

OUTLOOK: *** Data/speaker calendar (prior, estimate):

- Oct Sep personal income (0.2%, 0.4%) 0830ET

- Oct Sep current dollar PCE (0.1%, 0.9%) 0830ET

- Oct Sep total PCE price index (0.2%, --) 0830ET

- Oct Sep core PCE price index (0.1%, 0.1%) 0830ET

- Oct Oct Dallas Fed manufacturing index (21.3, --) 1030ET

- Oct US Tsy $36B 26-wk bill auction (Nov. 2 settle) 1130ET

- Oct US Tsy $42B 13-wk bill auction (Nov. 2 settle) 1130ET

- Oct US Tsy $50B 37-day Cash Mgmt Bill (Nov. 1 settle) 1300ET

- Oct Sep farm prices (-2.0%, --) 1500ET

Eurodollar/Treasury option summary

Eurodollar options

Pit/screen:

* 10,000 Green Jan 73/76 put spds vs. Green Jan 80 calls, even net

* Block, 10,000 Jun 78/80 put spds, 2.5 vs. 98.185/0.10%

* 15,000 Red Jun 73/76 2x1 put spds, 2.0 vs. 97.93/0.10%

* Update, total -25,000 Red Sep 75/77 put spds, 8.5

* 10,000 Blue Dec 76 straddles, 23.0

* 5,500 Apr/Jun 81 put calendar spds, 2.5 vs. 98.185/0.10%

* Block, 15,000 short Mar 82 calls, 4.0 vs.

* Block, 22,500 short Mar 76 puts, 3.5 vs.

* Block, 15,000 short Mar 78 puts, 10.5, 2.5 net/put spd over

* +10,000 Sep 78/80 put spds, 4.0

* +1,000 Dec 81/82/83/85 put condors 4.0

* +50,000 Dec 82 puts, cab

* 20,000 Dec 83/85/86 call flys, 7.0

* Block, +5,000 short Nov 78 puts, 1.5 vs. 98.005/0.10%

Tsy options, Nov expires

Pit/screen:

* 3,675 TYZ 124.5/125.5 2x1 combo, 50/64 vs. 124-18.5/1.14%

* 2,400 TYZ 123.5/125.5 strangles, 22/64 vs. 124-15/0.05%

* 1,100 TYX 124.5/124.75 strangles, 2/64

* 3,300 TYZ 123/126 strangles, 12/64 vs.

* 1,100 TYZ 124.5 straddles, 1-4/64

* -5,000 TYZ 123.5/124 put strip, w/TYZ 125.5 calls, 50/64 total

* 2,100 wk1 TY 124.7/125.2 call spds, 9/64

* 10,000 Blue Dec 76 straddles, 23.0

* 5,500 Apr/Jun 81 put calendar spds, 2.5 vs. 98.185/0.10%

* 4,000 TUZ 127.7/107.8 call spds 2/64 vs. TUZ 107.3 puts, 1.5

* -3,000 TYZ 124/124.5 strangles, 59- to 58/64

--MNI New York Bureau; tel: +1 212-669-6432; email: sheila.mullan@marketnews.com

[TOPICS: MTABLE,MNUEQ$,M$U$$$,MR$$$$,M$$FI$,MN$FI$]