Primary market bullets:
** Corporates storm out of the blocks on Monday providing all the session's EUR2.25bn of investment grade supply courtesy of three issuers and four separate deals.
** German industrial giants Continental AG and HeidelbergCement execute well received benchmarks having triggered strong early momentum with pragmatic approaches to pricing. For more details see IGM Comment here.
** The secondary market maintained a tightening bias compared to Friday's levels as the slight recovery seen in recent days following a prolonged period of widening since the US elections appears to have a bit more stamina. See IGM Corporate Snapshot for performance tracker.
** Since the ECB began purchases under its CSPP programme on 8th June, holdings settled as of 25th November totalled EUR46.231bn. This latest total points to an implied monthly purchasing rate of EUR8.06bn, holding steady at last week's level. For more details see the IGM ECB CSPP Review.
** There was also some sterling supply on the day thanks to Severn Trent Utilities which commanded over GBP500m of demand for its new GBP400m Dec 2031 line which marked the first IG corporate senior unsecured benchmark bond in the denomination since the end of October. The deal priced at UKT +105bps, from IPTs at +110-115bps.
Broader market price action on Monday:
** Negative start to the week for European risk assets amidst ongoing concerns regarding Italian banks with more jitters present ahead of the looming referendum on Senate reform on 4-Dec.
** European stocks (SXXP) seen making losses on the day, -0.62% as at 15.24 GMT, weighed down by Financials and Telecoms subsectors which were 1.37% and 1.00% in the red respectively.
** Much the same story for iTraxx indices with the Main +0.47 at 81.81 as at 15.27 GMT but was seen paring some earlier losses after touching 82.5 in earlier trading, its widest level since 8-July. The Crossover was +0.08 at 341.19 at the time of writing.
** Oil prices down around 2% in early trading before rebounding later in the session after news Iraq was 'optimistic' of a deal being reached at Wednesday's OPEC meeting. Brent Crude seen at +2.50% at US$48.42 a barrel as at 15.26 GMT.
** Scant event risk but decent bond ranges with Bunds/Gilts up to circa 2.5 week highs. See IGM EU Fixed Income Close for more details.
What to watch Tuesday:
** Data: Focus is on Flash CPI from Spain and Germany for early signals on the pan-EZ version, due Weds. France reports flash Q3 GDP, seen steady at 0.2% QoQ, while UK Mortgage Approvals are seen inching higher in Oct. The afternoon focus is on US Q3 GDP (2nd estimate), expected to be revised upwards to 3% QoQ AR from 2.9%. US Nov consumer confidence is expected back above 100.
** Events: Fed's Dudley is due to speak about the Puerto Rican economy, while Powell speaks at a luncheon sponsored by Economic Club of Indiana in Indianapolis � a Q&A follows both speeches which may provoke questions on US monetary/fiscal policy.
** Supply: Italy sells EUR2.25-3.25bn 2021 & 2026 BTPs as well as EUR1.75-3bn 2022 & 2024 CCTeus. The 10yr BTP/Bund spread hit its widest level since May 2014 on the eve of the sale which comes just days before the Dec 4th referendum on senate reform.
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