EU CREDIT UPDATE: CREDIT UPDATE: € Credit Close
Jul-10 15:31
- Bunds opened on a catch-up to late strength in treasuries and stayed firm for most of the session, with dovish RNZB overnight also helping. DBRs / USTs left -4/+0bp. US CPI is the main event tomorrow.
- Stocks moved higher over the session, with European equities correcting some recent weakness. SPX / SXXP left +0.2/+0.8%. €IG issuer equities mirrored SXXP at +0.8% with Real Estate strongest at +2%. Notable movers include Aroundtown +7%, Enagas +6%, Mobico +6%.
- €IG cash was weaker at the margin, with heavy supply in Financials today. Movers include GSWITCH +6bp with Medical Equipment also heavy; MDT/TMO 3-5 wider. Like yesterday, high beta Real Estate was stronger in places with ARNDTN (5-16) and HEIBOS (1-8) tighter.
- Primary saw prints from SCRSBE, LOGICR, BZLNZ, CAABNK, CNPFP, LAMON and TPEIR. The ATH FA-backed deal got pulled.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
US STOCKS: Equities Roundup: Off Lows, Oil & Gas, Utilities Outperforming
Jun-10 15:29
- Stocks are trading near steady to mixed ahead midday, off early session lows with Nasdaq outperforming -- a relatively quiet session ahead of Wednesday's CPI and FOMC policy announcement.
- Currently, the DJIA is down 72.56 points (-0.19%) at 38726.3, S&P E-Minis up 2.25 points (0.04%) at 5358, Nasdaq up 40.6 points (0.2%) at 17173.47.
- Energy and and Utility sector shares outperformed in the first half, oil and gas shares supporting the former as crude prices continued to rise off last week's lows (WTI +1.15 at 76.68): EQT Corp +1.80%, APA +1.60%, Diamondback Energy +1.53%. Independent and electricity providers buoyed the Utility sector: Constellation Energy +5.85%, Vistra Corp +4.98%, AES +2.77%.
- On the flipside, Financial and Consumer Staples sectors underperformed in the first half of trade, banks and financial services shares weighing on the former: Huntington Bancshares -6.53% after poor forward guidance, Regions Financial and Citizens Financial both -2.88% while KeyCorp declined 2.66%. Meanwhile, Consumer Staples weighed by food and beverage shares: Kraft-Heinz -3.11%, Brown-Forman and PepsiCo both -2.69%, Conagra Brands -2.59%.
- Notable earnings releases this week include: Casey's General Store, Oracle, Broadcom, Adobe and Lennar Group.
ITALY DATA: IP Weak In April, With Surveys Suggesting Little Respite Ahead
Jun-10 15:24
Italian industrial production once again printed weaker than consensus forecasts, with an April print of -1.0% M/M SWDA (vs 0.2% cons, -0.5% prior) and -2.9% Y/Y WDA (vs -2.1% cons, -3.2% prior).
- The data confirms the weak development portrayed by sentiment surveys, and recent confidence readings suggest there is little respite in the months ahead.
- The May manufacturing PMI was an extremely weak 45.6 (vs 48.0 cons). The report highlighted that domestic and international demand conditions remained subdued in May, prompting a pullback in employment and weaker pricing power amongst firms.
- Similarly, the EC and ISTAT industry surveys remained below neutral levels in May with little indication of recovering conditions in the months ahead.
- Looking at the sub-components, durable consumer goods pulled the index lower in April, printing at -1.6% M/M and -8.5% Y/Y. Intermediate and capital goods also saw negative developments on a monthly and annual basis.
STIR: Euribor Futures Eye May 31 Lows As Political Uncertainty Dominates
Jun-10 15:21
Euribor futures remain under pressure alongside core EGBs as this morning’s political uncertainty continues to dominate discussions. The strip is -1.0 to -6.5 ticks lower through the blues, with many contracts sitting just above the May 31 lows.
- ECB-dated OIS have seen a modest round of hawkish repricing as a result, with 31bps of cuts priced through the remainder of this year (vs 33bps this morning).
- Today’s ECB speak has not been market moving, with Governing Council members continuing to underscore the Bank’s cautious/data-dependent approach when it comes to the next move for rates.
- A reminder that the MNI Policy Team hosts a webcast with ECB Vice President de Guindos on Wednesday. Registration link here.
- When speaking with Spanish radio following last week’s rate decision, Guindos noted that there was “huge uncertainty on the economy”. As such, there will be interest in how much weight he applies to the latest Eurosystem macroeconomic projections in his decision making, in light of this uncertainty.
- Several ECB speakers are scheduled tomorrow, with Chief Economist Lane headlining at 1205BST. The data calendar is relatively sparse.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Cut Adjusted Current Effective ESTR Rate (bp) |
| Jul-24 | 3.654 | -0.8 |
| Sep-24 | 3.530 | -13.2 |
| Oct-24 | 3.488 | -17.5 |
| Dec-24 | 3.354 | -30.8 |
| Jan-25 | 3.295 | -36.7 |
| Mar-25 | 3.201 | -46.2 |
| Apr-25 | 3.145 | -51.7 |
| Jun-25 | 3.048 | -61.5 |
| Source: MNI/Bloomberg. 2025 dates are estimated. | ||
