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Thursday's primary highlights

** Thanks to a mammoth deal from Volkswagen, primary supply increased significantly to EUR11.215bn on Thursday, compared to just EUR5.265bn on Wednesday. For a breakdown of the day's Euro supply see IGM's DAILY EUR NICS & BOOKS

** Supply was spearheaded by German automaker Volkswagen which returned to the market with a jumbo EUR8bn 4-part issue, marking the issuer's first visit to the Euro senior unsecured market since it was first caught up in an emissions scandal back in September 2015. A blow out, the largest corp trade YTD ammassed demand of over EUR25bn, allowing pricing to be tightened 15bps on each tranche resulting in NICs of 10-15bps on the 4, 6.5 and 10yr fixed rate tranches, while the 2yr FRN printed broadly flat to the curve. For more see the IGM CORP SNAPSHOT

** PKO Bank Hipoteczny boosted its fledgling covered bond curve with a EUR500m Jan 2023 line at m/s +27 whilst Toronto Dominion Bank's EUR1.25bn Apr 2024 deal marked only the second Canadian covered bond in the single currency YTD. For more details including relative value analysis see IGM's COVERED SNAPSHOT

** In FIG, Caixa Geral de Despositos re-opened the Euro market for Portuguese issuers with the first deal in any sector since late 2015, with its EUR500m PNC5 temporary write down AT1 pricing at 10.75% (from 11%/11.5% IPTs). Meanwhile, the prior session's trio of Euro deals were all performing well in secondary, notably Mapre S.A.'s 30NC10 tier 2 Sub which was bid as much as 1.6 pts above its reoffer price. See IGM's FIG SNAPSHOT


Friday's potential primary supply

At the time of writing there were no confirmed deals for the traditionally quieter day of Friday although a couple of issuers may decide to pull the trigger as follows:

** HYPO NOE Gruppe Bank AG could go live with a 6yr or 8yr EUR denominated Public Sector Covered Bond benchmark transaction after wrapping up a 2-week pan-European fixed income roadshow on Wednesday. The deal is expected to be rated Aa1 by Moody's

** Unrated Normet Group Oy may launch a new EUR hybrid issue after conducting a series of fixed income investor meetings from 13-March via OP Corporate Bank


Broader market developments on Thursday

** EU risk assets hold onto gains as the day draws to a close. No new game changing news out in the Eurozone, while UK Retail Sales post their highest MoM gain since Oct 2016

** Govvies - EGB yields edge broadly lower, although Gilts buck the declining trend on the back of the huge UK Retail Sales beat. 10yr Gilt yield rises 3.8bps as at 14.36GMT

** Morning bounce in Brent fails to last as oversupply concerns weigh, putting Brent on track for its 4th straight day of losses although prices respect Wednesday's multi-month low. OPEC members to meet in Kuwait at weekend to review compliance to the production-cut deal, after this week's API and EIA data showed stocks build

** iTraxx indices tighten but respect weeks tights


Market snapshot (14.57GMT)

SXXP 0.41% / SX7P +0.46%

GER 2yr +1.8bps at -0.766% / 10yr +0.4bps at 0.408%

Brent -0.45% at USD50.41

iTraxx Main -1.4 at 75.7 / Crossover -5.8 at 294.7


What to watch Friday

** Data: No top tier releases out in Europe with just UK Feb BBA Loans for House Purchases. Across the pond, watching Durable Goods Orders for Feb and Markit's March Manufacturing PMI (est 54.7)

** Events: A trio of Fed officials are lined up to speak in the shape of Evans (11.00), Bullard (12.05) and Dudley (13.00)

** Supply: There are no significant term auctions scheduled in Europe or US on Friday 24th March

** Earnings: There are just 2 Stoxx600 companies due to report


SSA Priced / SSA Pipeline

CORP Priced / CORP Pipeline

FIG + Covered Priced / FIG + Covered Pipeline


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