EUROZONE ISSUANCE: EGB Supply
Italy will look to hold an auction today and continue with its BTP Italia issuance. Already this week, Spain has held a syndication while the Netherlands and Germany both held auctions (as well as another Italian auction). We pencil in estimated gross issuance for the week of E32.4bln (excluding the BTP Italia), down from E42.7bln last week.
- Today, Italy will look to conclude auction issuance for the month with a 5/10-year BTP / CCTeu auction (including a new issue of the latter). On offer will be E3.00-3.25bln of the on-the-run 5-year 2.95% Jul-30 BTP (ISIN: IT0005637399) alongside a first reopening for E3.00-3.25bln of the 10-year 3.60% Oct-35 BTP (ISIN: IT0005648149). We had discussed the possibility of a new CCTeu in our EGB Issuance, Redemption and Cash Flow Matrix last week and indeed the MEF will offer E3.0-3.5bln of the new Apr-34 CCTeu (ISIN: IT0005652828) with a spread of 0.85%.
- Italy will look to issue a 7-year BTP Italia this week, maturing 4 June 2032. This will be the first BTP Italia since March 2023 with an offering for retail investors (ISIN: IT0005648248) between Tuesday and Thursday and for institutional investors (ISIN: TBC) on Friday. As usual, the BTP Italia is linked to Italian inflation (rather than Eurozone inflation).
- At the end of the second day, books closed in excess of a combined E5.289bln (E3.144bln Day 1, E2.145bln Day 2)
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EURGBP TECHS: Bear Cycle Extension
- RES 4: 0.8781 2.236 proj of the Mar 3 - 11 - 28 price swing
- RES 3: 0.8768 High Nov 20 ‘23
- RES 2: 0.8624/0.8738 High Apr 21/ High Apr 11 and the bull trigger
- RES 1: 0.8557 High Apr 28
- PRICE: 0.8495 @ 06:46 BST Apr 29
- SUP 1: 0.8487 Intraday low
- SUP 2: 0.8477 61.8% retracement of the Mar 28 - Apr 11 rally
- SUP 3: 0.8459 50-day EMA
- SUP 4: 0.8415 76.4% retracement of the Mar 28 - Apr 11 rally
EURGBP traded lower Monday, marking a continuation of the current bear cycle. Note too that the move down cancels the doji reversal signal on Apr 25. Sights are on 0.8477, a Fibonacci retracement point where a break would strengthen the bearish theme. It is still possible that short-term weakness is corrective. A reversal and a resumption of gains would open 0.8738, the Apr 11 high and bull trigger.
EUROZONE T-BILL ISSUANCE: W/C April 28, 2025
Greece is due to sell bills today, while Italy, Germany and France have already come to the market. We expect issuance to be E17.0bln in first round operations, up from E14.6bln last week.
- This morning, Greece will look to sell E500mln of the new 13-week Aug 1, 2025 GTB.
EUROSTOXX50 TECHS: (M5) Corrective Phase Remains In Play
- RES 4: 5341.00 High Mar 27
- RES 3: 5263.01 76.4% retracement of the Mar 3 - Apr 7 bear leg
- RES 2: 5165.00 High Apr 3
- RES 1: 5150.00 High Apr 28
- PRICE: 5122.00 @ 06:10 BST Apr 29
- SUP 1: 4959.00/4812.00 Low Apr 23 / 16 and a key support
- SUP 2: 4664.00 Low Apr 10
- SUP 3: 4444.00 Low Apr 7 and the bear trigger
- SUP 4: 4336.00 Low Nov 28 ‘23 (cont)
Eurostoxx 50 futures maintain a positive tone and are holding on to their recent gains. The contract has cleared the 20-day EMA and pierced the 50-day EMA, at 5101.76. A clear break of this average would strengthen the current bull cycle and signal scope for a continuation of the corrective uptrend. This would open 5165.00 next, the Apr 3 high. Support to watch lies at 4812.00, the Apr 16 low. Clearance of this level would highlight a reversal.
