EU UTILITIES: EDF: Potential Edison Divestment
Sep-05 16:35
(EDF; Baa1/BBBpos/BBB+neg)
Supportive for credit, potentially limiting new supply. Excess funds are likely to go investment rather than deleveraging.
- EDF is considering relisting Edison SpA and could sell all or part of it. Potential asset sales outside France were previously mentioned.
- Edison’s FY EBITDA is expected in the upper range of the €1.2-1.4bn range, which would put it close to Iren. Iren has an EV of ~€7.5bn.
- EDF has annual capex of around €26bn, covered from operating cash flow last year. Investments could step up again from 2027 with the government aiming to build six new reactors.
- It has €2-6bn maturities annually for the coming years. It has £3bn in private funding undrawn.
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US TSYS/SUPPLY: Preview 10Y Auction
Aug-06 16:20
- Treasury futures are moderately weaker (well off recent gap low of 111-26.5) with TYU5 -6 at 112-03.5 ahead of the $42B 10Y Note auction (91282CNT4) at the top of the hour, WI currently 4.245%, 11.7bp rich to last month's stop.
- July auction recap: Treasury futures held near session highs (TYU5 +11 at 111-04, 4.3616% yld) after the $39B 10Y note auction re-open (91282CNC1) stopped .3bp through: drawing 4.362% high yield vs. 4.365% WI; 2.61x bid-to-cover vs. 2.52x prior.
- Peripheral stats: indirect take-up retreated to 65.42% vs. 70.56% prior; direct bidder take-up at 23.70% from 20.48% prior; primary dealer take-up 10.87% vs. 8.96% prior.
US STOCKS: Equities Roundup: Recovering Prior Session Sell-Off
Aug-06 16:16
- Stocks are moderately higher at midday Wednesday, recovering approximately half of the prior session's losses after White House officials said Apple will announce a commit to investing another $100B on US manufacturing today. However, speculation over whether Pres Trump will announce new Russia sanctions or nominees for Fed governor or BLS head tethered risk appetites somewhat.
- Currently, the DJIA trades up 123.26 points (0.28%) at 44235.11, S&P E-Minis up 44.25 points (0.7%) at 6369.5, Nasdaq up 204.5 points (1%) at 21119.92.
- A mix of IT, Financials, Consumer Staples and Discretionary sector shares led first half gainers: Arista Networks +17.08%, Match Group +9.99%, Assurant +8.80%, Global Payments +5.93%, Apple +5.66%, Walmart +3.78%, Target +3.20%, Palantir Technologies +3.10%, Devon Energy +3.06%, Tesla +3.02% and McDonald's +2.79%.
- A couple notable IT exceptions bucking the move: Super Micro Computer -21.44% after earning outlook disappoints, while Advanced Micro Devices declined -7.04%.
- Leading decliners included Health Care, Materials and Energy sector share: NRG Energy -14.99%, Mosaic -10.45%, Emerson Electric -9.19%, Rockwell Automation -8.27%, DaVita -7.89% International Flavors & Fragrances -7.69%, Charles River Laboratories -6.64%, Paramount Global -6.17% and Amgen -5.83%.
- Companies expected to announce earnings after today's close include: Corteva, McKesson Corp, Occidental Petroleum, AIG, DoorDash, Fortinet, AppLovin, Lyft, Dutch Bros, Airbnb Inc, Zillow Group, Duolingo, MetLife, APA and DraftKings Inc.
US TSYS: Tsy Gap Lower - Rebound
Aug-06 15:59
- Treasuries gapped lower in the last few minutes, no obvious headline driver or Block/cross cited for move with some desks citing trade error for the initial move.
- Stops triggered on the way down volume jumped on the move (TYU5 appr 60,000 over a two minute span) as futures fall to 111-26.5 low -- then rebound.
- Currently, the Sep'25 10Y futures currently trades -5 at 112-04.5 vs. 112-06.5 pre-move.
- Curves gapped steeper but have retreated as well: 2s10s tapped 54.666 high currently +2.999 at 51.367.
