US Tsys went out at session highs on...>

US TSY/RECAP: US Tsys went out at session highs on Tuesday, with the session's

price action mainly driven by shifts in US stocks, rallying on any move lower in

equities but holding firm on any recovery.

- 5-Year Note supply passed without a hitch, with a small tail, steady cover

ratio and slightly lower dealer take-up when compared to the prior auction.

- Just before the close, 10-Year yields broke significantly below 2.80%, with

the 2s-10s curve flattening by around 4bp on the session as as 2s lagged.

- There was little in the way of notable US data on Tuesday, but the lower tier

releases were generally on the softer side.

- A WSJ piece noted that Fed's Bostic (Voter) supported plans to gradually raise

interest rates, but noted uncertainty re: fiscal matters.

- Buying was noted in 5- & 10-Year Tsy call options, with notable sell side flow

observed in Eurodollar put options.

- Swap spreads were tighter with the 2-year space 5.5bp tighter. Decent flow was

noted, receiving the belly in the 2Y-10Y-30Y fly.

- T-Notes last 120.31+, US 10-Year yields last 2.775%.