Bonds were leading off in a slightly friendly direction during the overnight session, largely because we hadn't really heard from China with respect to yesterday's trade deal drama.  Nonetheless, it seemed like more concrete steps were being taken, so markets were willing to move in a risk-on direction (better for stocks, worse for bonds) in general.

The whole "not hearing from China" thing was validated right out of the gate with headlines suggesting China had concerns about US agricultural purchase requirements.  Shortly thereafter, Trump tweeted harsh criticism for a WSJ article.  Almost everyone assumed he was referring to yesterday's article that blew the lid off the trade deal agreement.  With those two updates, suddenly, the deal didn't look like a sure thing and markets were quickly moving risk-off.

But there was one significant, final attempt to get the risk-on move back on track.  It came courtesy of China holding a news conference in which it essentially said "we agree with this deal and we're gonna sign it."  Markets traded as if the deal was--well... a DONE deal at first, but second thoughts quickly crept in.  At issue: nothing will be signed until Jan 2020 at the earliest--so we still only have words and promises.  Not only that, but some of the words have yet to be fleshed out (specifically, many of the conditions the US has placed on China, such as ag purchases for the Phase 1 process). 

Bottom line, yes it was much more of a deal than we've seen so far, and yes, it did fulfill the stock market's Christmas wish of getting the Dec 15th tariffs canceled, but apart from that, it fell short of offering a resounding confirmation of the phase 1 deal.  As such, bonds have unwound the bulk of yesterday's losses because they're smarter than stocks, which, for some reason, ended the day much closer to their better levels from the past 2 days.