EQUITIES: US Cash Opening Calls

• -10,575 UXYU5 113-01, sell through 113-03 post time bid at 0855:05ET, DV01 $925,000.
• The 10Y ultra contract trades 113-03.5 last

Gilt futures trade through Friday’s low but fail to challenge initial support at the July 3 low (92.12), basing at 92.23.

• The initial move may have been helped by some of U.S. Treasury Secretary Bessent’s comments re: several trade announcements being due over the next 24 hours/plenty of countries wanting to make deals, but the lack of visibility on the matter and ongoing volatility in headlines means that many are not willing to act until firmer details are seen.
• Note that equities have faded from highs, meaning broader risk-on trade is not a driver.
• Yields little changed to 2bp higher, curve steeper despite the presence of the incoming round of short bucket APF sales from the BoE.
• Front end resilience seemingly aided by BoE MPC Taylor’s latest dovish comments made late on Friday and the economic growth hit that potential future tax hikes would bring, resulting in light curve steepening.