EU FINANCIALS: Banco BPM - Press Release

Reuters reports comments attributed to the 'leader' of Germany's far-left progressive Die Linke regarding reform to the constitutional debt brake following the election. Says that the next gov't 'has to move on debt brake reform', and that Die Linke supports such a move, but the support will be conditional. Says that Die Linke 'will have to discuss very seriously' how far it is willing to go on debt brake reform and that the party expects to be included in talks. 

• As a party from the far-left, Die Linke is strongly in favour of increased gov't spending and not just reforming but abolishing the debt brake. However, as a pacifist party it is also strongly opposed to increased military spending either to support Ukraine or to bolster Germany's armed forces as the US shifts its focus away from Europe.
• Given Die Linke's support for debt brake reform is essential (its lawmakers combined with the far-right Alternative for Germany constitute a one-third blocking minority), the party will seek concessions from the incoming gov't, set to be led by conservative Christian Democratic Union leader Friedrich Merz.
• Note: Wire headlines claim Die Linke 'leader' has made these comments. Die Linke does not have one leader, but co-chairpersons (Ines Schwerdtner and Jan van Aken) and in the election had joint lead candidates (van Aken & Heidi Reichinnek). It is unclear which of these individuals has made the comments being reported. 

• On the commodity front, a bull cycle in Gold remains in play and the yellow metal continues to trade at its recent highs. Fresh recent gains once again confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull mode position too, highlighting a dominant uptrend. Sights are on the $2962.2, a 2.00 projection of the Nov 14 - Dec 12 - 19 price swing. The first key support to watch is $2867.1, the 20-day EMA.
• In the oil space, a bearish theme in WTI futures remains intact and the move lower last week, and today’s fresh short-term cycle low, reinforces a bear condition. Support at $70.20, the Feb 6 low, has been pierced. A clear break of it would strengthen the downtrend and confirm a breach of the 50-day EMA. This would open $67.75, the Dec 20 ‘24 low. Key short-term resistance has been defined at $74.06, the Feb 3 high. A move above this level would reinstate a bull theme. 

OI data suggests that a mix of net short (SFRZ4) & long (SFRH5 through Z5) setting dominated in the very front end of the SOFR futures strip on Friday.

• Positioning swings then became a little more balanced between net long setting and short cover further out the strip.