02 Feb 2018
Leading the industry in money fund news.
** Societe Generale set to be second French bank to raise non-preferred funding having mandated its own investment banking arm for a Euro long 5yr benchmark, hot on the heels of Credit Agricole which successfully debuted with a EUR1.5bn 10yr deal on Tuesday. For more details of the latter see IGM's FIG SNAPSHOT
** DISTRIBUTION; Poland took EUR750m out of the 5yr part of the curve with inaugural Green bond with a new issue concession of ca. 14bps. For more details including distribution stats click here
** UniCredit spreads snap tighter and the bank's stock pushes sharply higher after it outlined plans to shore up its capital base via a EUR13bn rights issue, 6,500 job cuts and the sale of bad loans.
The UCGIM 4.375% 2027 Sub callable in Jan 2022 was ca. 45bps tighter while Unicredit SpA's stock was +10.89% at EUR2.60 on Tuesday afternoon. For more see IGM COMMENT entitled "UniCredit tightens sharply on recapitalization plans"
** EFSF and ESM increase planned issuance volume in 2017 by EUR7bn to EUR57bn including an inaugural USD bond from ESM. For more details see IGM Preview. Elsewhere, Rentenbank outlined its plans for up to EUR12bn of funding in 2017, more details of which can be found here
Tuesday's broader market price action
** Italy's FTSE MIB led the rally in equities, boosted by financials after UniCredit announced plans to lift its capital base (details above)
** German and French curves bull flattened, BTPs led broad EGB rally, significantly outperforming peers while oil lost traction and European players shrugged off stronger data impulses (UK CPI, German ZEW)
** iTraxx indices continued their recent tightening trend with the Main and Crossover hitting their tightest levels since 25th Oct and 25th April resp
Market Snapshot (as at 15.47 GMT)
** BTP 10yr yield drops up to 12bps to 1.875%, nearing a one-week low
** SXXP +0.92%, SX7P +0.96%, FTSE MIB +1.70%
** iTraxx Main -1.4 at 70.9 / Crossover -6.7 at 296.7
** Brent crude -0.81%, after rising as much as 1.38%
What to watch Wednesday
** Data: UK employment data provides an insight on labour market conditions, pre-BoE Thurs. Eurozone Industrial Production to provide hard data how Q4 started out. Some key US releases (Retail Sales, PPI and Industrial Production) may only exert a transient impact as markets remain focused on the FOMC policy verdict due later the same day
** Events: FOMC rate verdict and Summary of Economic Projections form key highlights of the day with the first rate hike (of 25bps) expected since Dec 2015. Watching for any forward guidance
** Supply: UK to raise GBP800m via 2036 gilt linkers, some prior concession possible
IGM FX and Rates
31 Jan 2017
Between the inevitabilities of death and taxes one would like to hope there’s room for a comfortable, perhaps a long, retirement. Alas, the data on that possibility is rather depressing for an awful lot of Americans.