EUROZONE ISSUANCE: EGB Supply
Nov-10 06:41
Italy is due to issue today while Austria and Germany have already come to the market this week. We pencil in gross nominal issuance of E14.3bln, down from E34.5bln last week.
- Italy will look to conclude issuance for the week this morning with a 3/7/15/30-year BTP auction. On offer will be E2.5-3.0bln of the 3-year on-the-run 3.85% Sep-26 BTP (ISIN: IT0005556011), E1.0-1.5bln of the off-the-run 7-year 3.50% Mar-30 BTP (ISIN: IT0005024234), E1.5-2.0bln of the 7-year on-the-run 4.00% Nov-30 BTP (ISIN: IT0005561888), E1.0-1.5bln of the 15-year 3.25% Mar-38 BTP (ISIN: IT0005496770) and E0.75-1.0bln of the on-the-run 30-year 4.50% Oct-53 BTP (ISIN: IT0005534141).
For more on this week and next week's supply see the PDF here:
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CROSS ASSET: USD trades in the green versus G10s
Oct-11 06:41
- The Dollar is mostly on the front foot against most G10, with the Kiwi the worst performer, down 0.38%.
- Risk is tilted to the downside, but some small divergence between Europe and the US, with Emini closer to flat, up half a point, while Etsoxx (VGZ3) is down 26 points.
- Support in NZDUSD is at 0.5999, Yesterday's low.
BUNDS: Hovers near session low post Cash open
Oct-11 06:28
- Very little change for Bund post cash open, with the contract trading within Yesterday's range.
- German final CPI was inline, still, Bund remains at the upper of the October range on favoured FTQ.
- Some will look at Yesterday's high 129.47 for resistance, but next upside area will be at 129.62 (gap).
- Yesterday's support was seen at the 128.71/128.68, and this area somewhat held, did trade as low as 128.61 Yesterday.
- Today sees, ECB 1y/3y inflation expectations, and not happening that often, we will get US PPI a day before the awaited CPI release Tomorrow.
- FOMC minutes is also due, but unlikely to be a market mover.
- SUPPLY: UK £3.75bn 2034 (equates to 29.9k Gilt) should weigh, German 2048 and 2052 (equates combined to 13.1k Buxl) could weigh.
- And again some focus on the US selling $35bn of 10yr notes reopening.
- SPEAKERS: ECB Knot, de Cos Villeroy, Fed Bowman, Waller, Bostic, Collins.
BTP TECHS: (Z3) Sharp Bounce Off Lows
Oct-11 06:27
- RES 4: 113.84 High Sep 14
- RES 3: 112.52 High Sep 20
- RES 2: 110.66 20-day EMA
- RES 1: 109.97 High Oct 10
- PRICE: 109.95 @ 16:22 Oct 10
- SUP 1: 107.62 Low Oct 4
- SUP 2: 107.08 2.236 proj of the Jun 26 - Jul 11 - 19 price swing (cont)
- SUP 3: 106.40 2.382 proj of the Jun 26 - Jul 11 - 19 price swing (cont)
- SUP 4: 105.85 2.50 proj of the Jun 26 - Jul 11 - 19 price swing (cont)
BTP futures traded lower last week and breached support at 108.08, the Sep 28 low. Nonetheless, prices have rallied sharply across the first two days of the week, narrowing the gap with the 20-day EMA - which marks first resistance. Short-term gains are considered corrective for now, but strength north of here would prove constructive for the outlook. To resume the downtrend, prices need to slip back below 107.08, a Fibonacci projection on the continuation chart.
