European bond markets broke out to an early lead in the overnight session with Treasuries doing a great job of resisting the gains.  It's not that US bond markets weren't improving during that time, just that it wasn't nearly as quickly as Europe.  In fact, both MBS and Treasuries ended up beginning the domestic session in slightly weaker territory while European trading implied a much stronger open.

It didn't take long for US markets to get on board, however.  The CME open at 8:20am saw solid buying demand waiting to be unleashed on the Treasury futures complex.  Eurodollar and Oil futures were also active.  As seen in the chart below, Oil, Euros, and rates were all generally moving together during the overnight and morning hours. 

To be sure, the correlation wasn't that great in the short term, but equities markets were much more disconnected.  12:11pm changed that as stocks quickly got caught up with the rest of the pack.  From there, markets continued to move together into the 2pm hour before bottoming out and drifting mostly sideways toward the close.