US TSYS: TRUMPS SIGNS NEW TRADE DEAL WITH MEXICO, CANADA

US TSY SUMMARY: Tsy trading mildly higher at the top of the range, strong volume

(TYH 1.30M), curves flattening. Data today led by US Chicago PMI which came in

much stronger than expected at 66.4 vs 58.5 expected. The market seemed to

dismiss the strong report saying it reflects an uptick in activity ahead of the

implementation of tariffs.

-G20 Summit kicked off today with President Trump signing a new trade deal with

Mexico and Canada.

-In regards to China, "*LIGHTHIZER SAYS HE WOULD BE SURPRISED IF CHINA DINNER

FAILS-bbg"

-Headline out this morning, "*OPEC COMMITTEE SUGGESTS 1.3 M B/D CUT FROM OCT.

LEVEL: DELEGATE-bbg". WTI climbed back above %51 on headline, WTI currently down

(WTI -0.81, 50.64). 

-DXY up +.492, 97.270 (97.712L/97.311H), $/Eur down -0.0083 at 1.1310, $/Yen up

+0.11 113.59; equities higher (emini +14.00, 2758.25 vs. 2759.75H); Gold down

(XAU -2.20, 1221.99)

-Tsy cash/ylds: 2Y 99-28.5 (2.805%), 5Y 100-5.5 (2.836%), 10Y 101-00 (3.006%),

30Y 101-10.5 (3.304%).

US TSY FUTURES CLOSE: Trading mildly higher at the top of the range; strong

volume (TYH 1.25M); curves flattening; update:

* 2s10s -2.006, 19.904 (19.070L/21.971H);

* 2s30s -1.702, 49.677 (48.579L/51.822H);

* 5s30s -1.038, 46.608 (46.010L/48.155H);

Current futures levels:

* Mar Ultra bonds up 19/32 at 152-20 (152-01L/152-21H)

* Mar 30-yr Bond futures up 18/32 at 140-02 (139-17L/140-02H)

* Mar 10-yr futures up 06/32 at 119-16 (119-11.5L/119-17H)

* Mar 5-yr futures up 02/32 at 112-31.75 (112-29.5L/113-0.5H)

* Mar 2-yr futures up 0.25/32 at 105-15.75 (105-14.75L/105-16H)

US EURODOLLAR FUTURES CLOSE: White pack trading steady to slightly higher while

reds through golds trading mildly higher; moderate volume. Current White pack

(Mar'19-Dec'19):

* Mar'19 0.000 at 97.150

* Jun'19 0.000 at 97.085

* Sep'19 +0.005 at 97.030

* Dec'19 +0.005 at 96.975

* Red pack (Mar'20-Dec'20) +0.015-0.005

* Green pack (Mar'21-Dec'21) +0.015-0.005

* Blue pack (Mar'22-Dec'22) +0.010

* Gold pack (Mar'23-Dec'23) +0.025-0.015

     US DOLLAR LIBOR: Latest settles,

* O/N -0.0053 to 2.1775% (+0.0005/wk)

* 1 Month -0.0024 to 2.3469% (+0.0250/wk)

* 3 Month -0.0020 to 2.7361% (+0.0449/wk)

* 6 Month +0.0094 to 2.8946% (+0.0084/wk)

* 1 Year -0.0138 to 3.1203% (-.0159/wk)

     US TSYS: *** /REPO REFERENCE RATES: (rate, volume)

* Secured Overnight Financing Rate (SOFR): 2.24% vs. 2.19% prior, $850B  

* Broad General Collateral Rate (BGCR): 2.23% vs. 2.19% prior, $427B     

* Tri-Party General Collateral Rate (TGCR): 2.23% vs. 2.19% prior, $402B 

PIPELINE: NO NEW ISSUANCE FRIDAY

     OUTLOOK: 

Dec 03 *** Nov    NA-made light vehicle sales SAAR        10.1    -- m 

Dec 03 *** Nov    Markit Mfg Index (final)                55.4    --     0945ET

Dec 03 *** Nov    ISM Manufacturing Index                 57.7   57.4    1000ET

Dec 03 *   Oct    construction spending                    0.0    0.4  % 1000ET

Eurodollar/Treasury Option Summary

Eurodollar options, Pit/Screen: 

* 5,000 Mar 70/71 put sprd at 4 vs 9715/0.26%

* -5,000 Blue Dec 70 Straddle at 10.5

* 10,000 Dec 71 puts at 0.5

* -21,700 Short Jan 71 calls at 3.5 vs 9699/0.27% BLOCK

* +4,000 Red Dec 65/75 calls over risk reversal at 1.5 vs 9697/0.31%

* 15,000 Long Green Sep 72/75 call sprd at 9

* 10,000 Mar 71 Straddle at 13.5

* 30,000 Short Dec 70 calls at 4 vs 9698/0.43%

Total -20,000 Short Dec 68/70 1x2 call sprd at 4

* 12,000 Jun 66/71 2x1 put sprd at 12 vs 9708.5/0.40%

Total -35,000 Short Dec 70/73 call sprd at 3.5 vs 97.5/0.40%

* 15,000 Short Jan 68/71 Puts over risk reversal at 0.5 vs 9698/0.52%, note

another 5k traded in pit

* Total 20,000 Short Dec 70 calls at 4 vs 9698/0.43% BLOCKED

TSY OPTIONS:

* +7,500 Wk1 TYZ 119.25/119.75 Strangle at 25 BLOCK, note +3,500 bought in pit

* 5,000 TYH 113/115 2x1 put sprd at 0

* +10,000 FVH puts 106.5 at 1

--MNI Chicago Bureau; +1 630-698-0154; email: ryan.martin@marketnews.com

[TOPICS: MTABLE,M$U$$$,M$$FI$,MN$FI$,MN$FX$]