US CAPITAL GOODS: Amcor: 4Q25 Results

SOFR options leaned toward downside puts/put spds overnight, mostly Sep'25 expiry, Tsy options more paired with the exception of +20k Aug 5Y put. Underlying futures have retreated from modest late overnight highs, curves twist flatter in the lead up to June CPI inflation data at 0830ET. Projected rate cut pricing have cooled vs late Monday (*) levels: Jul'25 at -0.6bp (-1.2bp), Sep'25 at -15.7bp (-16.2bp), Oct'25 at -29.4bp (-30.7bp), Dec'25 at -46.7bp (-48.9bp).

• SOFR Options
  • 10,250 SFRU5 95.81 puts, ref 95.84
  • +2,000 SFRU5 95.87/96.00/96.06/96.18 call condors, 2.75
  • 2,000 SFRU5 95.56/95.68 2x1 put spds ref 95.85
  • +2,500 SFRU5 95.25/95.75 put spds, 3.5
  • +5,000 SFRZ5 95.75/95.87/96.00 put trees, 2
  • 4,000 SFRQ5 95.75/95.81 put spds
  • Block/screen +14,100 SFRU5 95.62/95.75/95.81/95.87 broken put condors, 0.5
  • +2,500 SFRU5 96.12/96.37 call spds, 1.25
• Treasury Options:
  • -2,500 wk3 TY 111.25 calls, 6 vs. 110-24.5/0.25%
  • -2,000 FVQ5 107.75/108 put spds, 6
  • +3,500 TYQ5 109.75 puts, 5 vs. 110-25/0.08%
  • 2,000 TYQ5 111.5 calls, 9 vs. 110-24.5/0.21%
  • -1,000 FVU5 108 straddles, 104.5 vs. 108-04/0.10%
  • +20,000 FVQ5 107.75 puts, 7.5
  • +4,000 Wednesday wkly TY 111.5/111.75 call spds, 1 ref 110-23.5 to -24.5
  • +10,000 TYQ5 112 calls, 4

Reuters reports that the European Commission has sent a letter to Slovakian PM Robert Fico regarding his opposition to a phase-out in Russian fossil fuels in the EU that threatens the adoption of an 18th package of sanctions on Russia (see "EU-RUSSIA: Foreign Ministers Look To Sign-Off On 18th Sanctions Package", 09:18BST). 

• Letter says that the EU "will work with Slovakia to address its concerns" about he phase out. The EU "will clarify how an 'emergency brake' can be triggered if gas prices spike because of scarce supply during the phase out".
• The EU "will develop a solution for cross-border tariffs in the oil and gas trade for Slovakia, aimed at reducing these costs." The letter says the EU "will allow amendments to long-term Russian gas contracts aimed at getting more favourable terms for Slovakia", and that Brussels "is ready to intervene, if needed, during potential litigation resulting from the Russian gas phase out."
• EU foreign ministers are meeting presently in Brussels. Ahead of the meeting, European High Representative for Foreign Affairs and Security Policy Kaja Kallas said, "We are very, very close. I hope it comes today," Regarding the lowered price cap on Russian oil, Kallas said "It's alive...We have made proposals, but it is a question of whether we can overcome the veto of one member state or not. But we are trying to work on that."
• However, CGTN Europe reported earlier that ministers had failed to reach an agreement, with Slovakia and Malta continuing to object. 

Recent flow includes:

• ERU5 97.875/98.00 call spread 14K given at 11
• ERZ5 98.50/98.25 1x2 put spread 4.5K sold down to 6