EU CONSUMER STAPLES: Couche-Tard | NDA Signed
(ATDBCN: Baa1/BBB+)
(SVELEV; A2 CW Neg/A CW Neg)
7&i has finally signed an NDA, granting ATD access to financials. Slightly surprising this is still progressing - albeit at snails pace - given heated tone of the last public comments from both. It comes with a Standstill provision (terms undisclosed) which generally prevents a hostile bid and may curb ATD’s ability to speak publicly - a tactic it has been using thus far to apply pressure.
Stock in Tokyo was +2%, but we still see with >20% upside to the last leaked offer (~¥2,670). We see €-curve as fair.
ATD: "We appreciate the Special Committee of Seven & i engaging in substantive discussions..."
7&i: “[This] is a positive step...[but] we remain committed to pursuing two parallel paths to ensure that value for shareholders and other stakeholders is maximized...Nothing has changed in that regard"
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EGB FUNDING UPDATE: Ireland Q2 issuance plan
Ireland has announced that it will hold one auction in Q2 on Thursday 8 May, with the details announced on Tuesday 6 May.
FOREX: USD Index Holds Ground in Penultimate Pre-Liberation Session
- The USD Index holds above the 104.00 handle in the penultimate session before Wednesday's tariff announcement, with the near-term trajectory of the USD still subject to risk appetite and the market's inability to price the global trade picture. This leaves the greenback subject to the whims of equities - which are mixed so far Tuesday having bounced off the pullback lows. This still leaves the e-mini S&P within range of support layered between 5533.75-5559.75.
- Overnight FX vols are seeing some support - but the contracts won't fully capture Trump's tariff announcement until tomorrow - leaving markets still scratching their heads over quantifying the specific risks this week.
- Scandinavian currencies are modestly outperforming in early trade, undeterred by some uninspiring PMI manufacturing prints from Norway and Sweden. The single currency is off overnight lows, having found demand into the 1.0800 handle, but the bounce is shallow at this stage - contained by the slightly soft Eurozone Core CPI reading: 2.4% vs. Exp. 2.5%.
- US JOLTS job openings data is the Tuesday highlight, with the ISM Manufacturing release set to follow. Markets expect both metrics to deteriorate slightly over the month, and will be the final focus ahead of Wednesday's Rose Garden event, at which Trump is expected to unveil the full details of America's suite of tariffs to be used to rebalance global trade in the US' favour.
MNI: EUROZONE FEB UNEMPLOYMENT RATE 6.1%
- MNI: EUROZONE FEB UNEMPLOYMENT RATE 6.1%
