US TSYS: US TSY CURVES STEEPEN/APPROACH KEY LEVELS

US TSY SUMMARY: Tsys trading moderately lower into the bell, just off session

lows, strong volume (TYZ 1.54M). Large curve steepening today as 2s10s steepened

by 4.0bps while 5s30s jumped 2.0bps, both approaching their 50 day moving

averages; 10YY rises above 3.00%. Headline out this morning, "*CHINA SAYS

TARIFFS ON $60B OF U.S. GOODS EFFECTIVE SEPT. 24-BFW", led to slight risk-off

price action.

-US$ higher DXY +.145, 94.641 (94.315L/94.729H), $/Eur slightly lower -0.0020 at

1.1663, $/Yen higher +.50 112.34, (111.67L/112.39H); equities higher (emini

+19.00, 2915.00 vs. 2917.75H); Gold down (XAU -4.34, 1197.14); West Texas crude

higher (WTI +0.88, 69.79).

-Tsy cash/ylds: 2Y 99-21.3 (2.799%), 5Y 99-4.5(2.936%), 10Y 98-16.5 (3.048%),

30Y 96-6.5 (3.197%).

TECHNICALS:

US TSY FUTURES CLOSE: Trading moderately lower making new session lows into the

bell, strong volume (TYU 1.49M), Large curve steepening; update:

* 2s10s +3.844, 24.516 (20.189L/24.702H);

* 2s30s +4.572, 39.420 (34.731L/39.836H);

* 5s30s +1.999, 25.878 (23.655L/26.309H);

Current futures levels:

* Dec Ultra bonds down 1-17/32 at 154-10 (154-09L/156-09H)

* Dec 30-yr Bond futures down 31/32 at 140-21 (140-19L/141-31H)

* Dec 10-yr futures down 10/32 at 118-26 (118-25.5L/119-10.5H)

* Dec 5-yr futures down 4.5/32 at 112-15.5 (112-15.25L/112-24H)

* Dec 2-yr futures down 01/32 at 105-11.5 (105-11.5L/105-13.5H)

US EURODOLLAR FUTURES CLOSE: Trading mixed with the short end outperforming the

long end, at the bottom of the range with strong volume. Current White pack

(Sep'18-Jun'19):

* Dec'18 +0.010 at 97.370

* Mar'19 0.000 at 97.185

* Jun'19 -0.005 at 97.015

* Sep'19 -0.005 at 96.925

* Red pack (Sep'19-Jun'20) -0.030-0.015

* Green pack (Sep'20-Jun'21) -0.045-0.035

* Blue pack (Sep'21-Jun'21) -0.050-0.045

* Gold pack (Sep'22-Jun'22) -0.045

US DOLLAR LIBOR: Latest settles,

* O/N +0.0043 to 1.9189% (+0.0038 wk)

* 1 Month -0.0028 to 2.1653% (+0.0006 wk)

* 3 Month -0.0013 to 2.3375% (+0.0004 wk)

* 6 Month -0.0029 to 2.5679% (-0.0009 wk)

* 1 Year +0.0001 to 2.8795% (-0.0007 wk)

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

* Secured Overnight Financing Rate (SOFR): 2.00% vs. 1.95% prior, $789B

* Broad General Collateral Rate (BGCR): 1.97% vs. 1.91% prior, $410B

* Tri-Party General Collateral Rate (TGCR): 1.97% vs. 1.91% prior, $391B

PIPELINE: $2B CPPIB 5Y leads leads

Date $MM Issuer/Rating/Desc/Maturity/Yld/Leads; Priced *; Launch #:

09/18 $2B Canada Pension Plan Inv Board (CPPIB) 5Y MS+15

09/18 IADB 4Y

09/18 Wells Fargo 1.5Y FRN

09/18 EDF 10Y, 20Y, 30Y

09/18 BP Capital Mkts 7y, 10y

09/18 Japanese Finance (JFM) 5Y MS +44

09/18 Nissan Motor 3Y fix/FRN, 5Y fix/FRN

09/18 $500M ADB 10y+12

09/18 $1.5B Dexia 5Y MS +32

     OUTLOOK: 

- Sep 19 14-Sep MBA Mortgage Applications (--, --) 0700ET 

- Sep 19 Q2 current account balance (-$124.1b, -103.0b) 0830ET 

- Sep 19 Aug housing starts (1.168m, 1.240m) 0830ET 

- Sep 19 Aug building permits (1.303m, 1.320m) 0830ET 

- Sep 19 14-Sep crude oil stocks ex. SPR w/w 1030ET

Eurodollar/Treasury Option Summary

Eurodollar options, Pit/Screen: 

* +25,000 Short Dec 65/66/67/68 Put Condor at 1.5 vs 9687/0.33% vs Short Dec 71

calls 

* +10,000 Oct 73 Straddle at 4.75

* +9,000 Short Dec 71 calls at 4 vs 88.5/0.21%, >+25k traded so far today

* 4,000 Green Jun 66/71 call over risk reversal at 2.5

* 5,500 Dec 72 puts at 1 vs 9738/0.10%

* +7,000 Short Dec 66/67/68 put tree at 4

* +10,000 Short Dec 71 calls at 4 vs 9689/0.21%

* +20,000 Short Mar 65 puts at 3.5 vs 8.5/0.10%

* +10,000 Mar 68 puts at 1 vs 9716.5/0.05%, note +2,000 bought in pit, BLOCK

* 5,000 Dec 72 puts at 1 vs 9737.5/0.10%

TSY OPTIONS:

* +3,000 TYZ 119.5/122.5 call sprd at 28

* -15,346 TY Week1 119 puts vs TYV 119.5 puts at 9, BLOCK

* 13,000 TY Week1 119 puts at 25 vs 30.5/0.52%

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

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