02 Feb 2018
Leading the industry in money fund news.
Tuesday's primary market
** The fast start to 2017 continued on Tuesday where another EUR12.5bn of Euro paper was printed courtesy of 13 separate tranches, slightly up on the EUR10.25 which was issued on Monday. Total aggregate demand for Tuesday's deals stood at over EUR24.65bn. For a full list of the day's EUR bond please see IGM's DAILY EUR NICS & BOOKS
** Another three corporates tapped the single currency on Tuesday where Eni SpA and Imerys SA printed respective EUR750m and EUR600m 10yr tranches, whilst Telefonica Emisiones S.A.U issued a EUR1.75bn 8yr/long 11yr two-parter. The average spread compression from IPTs on Tuesday was 11.25bps which is less aggressive than the average 19.33bp on Monday's three corp deals. This resulted in a much higher average NIC of 10.25bps on Tuesday's deal compared to -0.33bps on Monday. See IGM's CORP SNAPSHOT for more
** FIG issuers stepped up a gear Tuesday, with four issuers launching five separate lines totaling E4.35bn. Bottom line -- there were plenty of buyers with combined demand topping EUR11bn for the senior, senior non-preferred and sub paper on offer. Spread compression through execution averaged 15.2 bps suggesting positive momentum in orders books. See IGM's FIG SNAPSHOT
** Erste Group Bank kept covered supply ticking over with a rare EUR750m 10yr Austrian covered bond which attracted interest over EUR1.25bn. For a more in depth look at the trade see IGM's COVERED SNAPSHOT
** The European Financial Stability Facility (EFSF) spearheaded SSA EUR supply on Tuesday with the borrower printing a EUR3bn Nov 2022 line at m/s -21, from -19 area IPTs on the back of demand topping EUR5bn. EFSF was joined by NWB Bank and Investitionsbank Berlin in Euros whilst IADB, KfW and Kommuninvest were among those which battled it out in Dollars. For more including relative value please see earlier IGM SSA PREVIEW
Wednesday's potential primary supply
** BAWAG P.S.K. is set to follow hot on the heels of Erste, having mandated Commerzbank, Goldman Sachs International, JP Morgan, Morgan Stanley and UBS Investment Bank for a new 10yr Austrian covered bond (Aaa), which will be backed by public sector revenues
** The Republic of Portugal, could launch a EUR Apr 2027 PGB having mandated BBVA, HSBC, JP Morgan, Morgan Stanley, Novo Banco and SG CIB on Tuesday - see SSA PREVIEW: Portugal to refresh 10yr Euro. Meanwhile, Agence Francaise de Developpement (AFD) is taking IoIs for a new EUR Apr 2022 bmk at OATs +high teens IPTs.
** Away from the single currency, MiniFin is marketing a USD500m 3yr floater at 3mL +17 area while EDC is marketting a USD 1bn 3yr at IPTs m/s +7 area
Broader market developments on Tuesday
** EU risk assets biased marginally weaker albeit in absence of any significant data or events, ahead of US Presidential elect's speech on Wednesday.
** FTSE100 was on course for 11 consecutive days of gains, having carved out another fresh historical high
** PGBs get hit with 10yr yield rising up to 13.1bps. Price action aligned to aforementioned EUR Apr 2027 syndicated benchmark issue. Other EGBs little direction
** Brent extends Monday's 3.78% loss
** iTraxx Main revisits levels last seen on the first full trading day of 2017, while Crossover was on course for its 5th consecutive day of widening having revisited 16th Dec levels
Market snapshot (15.15 GMT)
SXXP -0.11% / SX7P -0.37% / FTSE100 +0.44%
GER 2yr +0.8bps / 10yr +0.8
Brent flat at USD54.94
iTraxx Main +0.5 at 69.9 / Crossover +1.6 at 292.9
What to watch Wednesday
** Data: The UK focus lies with UK Trade figures, Industrial Production and NIESR GDP all due for release after Spain reports Industrial Output for Nov
** Events: Markets will be watching US President-elect Trump's inaugural post-election general news conference (no time specified). Also on the agenda, BoE's Carney testifies to MPs (14.15) and Fed's Dudley speaks after EU hours (18.20)
** Supply: Watch out for any concession going into German (up to EUR5bn) and US (up to USD20bn) 10yr bond auctions
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.