US Tsys were weaker on the day, reversing...>

US TSYS: US Tsys were weaker on the day, reversing the bulk of Tuesday's rally,

but moved away from worst levels on the back of a softer than exp. ADP print,

which was coupled with a negative revision, and a softer second GDP estimate.

- Italy remained the focus, successfully selling 5- & 10-year debt at auction,

bringing some relief to BTPs following the political issues that have plagued

the space in recent sessions. It is worth noting that the supply was supported

by large reinvestment flows from a bond maturing later this week, and the

10-Year issuance still held signs of the pessimism, with the average sale price

25 cents below the secondary-market level just before the bidding deadline.

- Volumes understandably slowed vs. Tuesday, with real-money & bank portfolios

selling intermediates & long end early on. Flatteners were noted in the form of

2s & 5s vs. 30s. Tsy futures roll volume slowed ahead Thursday's final notice.

Participants were cautious heading into Friday's NFP release. Rate hike bets

rebounded with MNI PINCH indicating a 100% chance of a Fed hike in June.

- T-Notes last at 120.17+, US 10-Year Tsy yield closed at 2.855%.