EU BASIC INDUSTRIES: Glencore (A3/BBB+/NR): Reorganisation
This move could lead to renewed speculation about the future of some assets, especially as the share price has faltered recently. The coal assets have contributed to spreads holding wide on ESG concerns.
- AFR reported that Glencore has moved less-desirable assets into its Australia subsidiary. This places SA assets with coal and an undeveloped copper mine, all considered non-prime, in one entity.
- Management said the moves were part of the previously planned coal spinoff and were completed despite the cancellation of that process.
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US 10YR FUTURE TECHS: (M5) Bull Cycle Extends
- RES 4: 113-22 1.382 proj of the Apr 11 - 16 - 22 price swing
- RES 3: 113-04 76.4% retracement of the Apr 7 - 11 bear leg
- RES 2: 112-12 61.8% retracement of the Apr 7 - 11 bear leg
- RES 1: 112-90 Intraday high
- PRICE: 112-06+ @ 10:47 BST Apr 30
- SUP 1: 11107+ 20-day EMA
- SUP 2: 110-16+/109-08 Low Apr 22 / 11 and the bear trigger
- SUP 3: 108-26+ 76.4% retracement of the Jan 13 - Apr 7 bull cycle
- SUP 4: 108-21 Low Feb 19
Treasury futures are trading higher this week as the contract extends the latest rally. Recent gains have resulted in a break of 111-25, 50.0% of the Apr 7 - 11 bear leg. The breach undermines a recent bearish theme and opens 112-12, the 61.8% retracement. On the downside, a reversal and a resumption of weakness, would refocus attention on 109-08, the Apr 11 low and the bear trigger. First key support to watch is 110-16+, the Apr 22 low.
EGBS: Natixis Recommend SPGB 5s10s Flattener Boxed Vs. BTPs
Natixis recommend entering SPGB 5s10s flatteners boxed against BTP 5s10s steepeners.
- They believe that at the current juncture “the tightening potential of EGB spreads is limited. We even believe the pay-off of sovereign spreads is now asymmetrical with widening risks taking over at some point”.
- Natixis suggest that “BTPs look more vulnerable than SPGBs, with Spain set to remain the top macro performer of the Eurozone”, while noting that the Italian macro situation is closer to Germany’s.
- They also think that “the shape of the Italian curve does not properly reflect potential vulnerabilities”.
OPTIONS: Expiries for Apr30 NY cut 1000ET (Source DTCC)
- EUR/USD: $1.1375-95(E2.7bln), $1.1425(E500mln)
- USD/JPY: Y140.50($1.9bln), Y142.00($1.8bln), Y144.40-50($959mln), Y145.00($1.5bln), Y148.50($716mln)
- AUD/USD: $0.6115(A$1.1bln), $0.6250(A$702mln)
- NZD/USD: $0.5950(N$521mln)
