With risk appetite rebounding from......>

EGB SUMMARY: With risk appetite rebounding from the equity plunge earlier in the

week, Core EGBs have opened Friday on the back foot, while BTPs have gained.

- Bunds are lower as European equities have rebounded early (DAX up 1.2%), with

the Dec18 future down 30 ticks at 158.05.

- German cash curve has steepened slightly so far, with 2-Yr yield up 0.3bps at

-0.534%, 5-Yr up 1.5bps at -0.054%, 10-Yr up 1.9bps at 0.537%, and 30-Yr up

1.3bps at 1.15%.

- Italian BTPs are faring better amid stronger risk appetite, though gains have

been slowed by PM Conte ruling out significant changes to the government's

budget proposal, reported Ansa (via BBG). Dec18 future last up 38 ticks at

120.17, off day`s high of 120.43.

- Periphery EGB spreads in slightly, led by 10-Yr Italy vs Bunds down 4.7bps at

299.9bps, Spain in 1.5bps at 111bps, Portugal (Moody`s reviewing tonight) down

1.9bps at 148.4bps and Greece 2.3bps narrower at 395.2bps.

- Analyst estimates point to a 0.4% m/m rebound in Euro Area industrial

production in August, data due out at 0900GMT.