CONSUMER STAPLES: Metro AG | 2Q (to March) earnings
(MEOGR 29s; NR/BBB- Neg) (now owned by Daniel Ketnsk) We expect downgrades, unless Kretinsky extend...
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EGBS: Weak 30-year Bund Auction Weighs On German Futures
Bund futures weakened following a soft 30-year auction, having now unwound ~75% of gains since yesterday's settlement. Futures are +24 ticks at 131.10 at typing, down from a session high of 131.52. Risk sentiment remains soft following overnight concerns around Nvidia’s H20 chip sales in China and fresh Trump tariff rhetoric. A BBG sources piece around US/China trade negotiations has provided some reprieve to equity markets.
- Yesterday’s high at 131.57 provides resistance in Bunds, with the 20-day EMA at 129.84 continuing to provide support.
- German yields are 1-2.5bps lower, with the curve steepening following the auction result. Today's 30-year sale followed a weak Bobl auction yesterday.
- This morning’s soft risk tone generally sees 10-year EGB spreads to Bunds widen. The BTP/Bund spread is up 1.5bps to 119.5bps, but remains comfortably above last week’s close following S&P’s rating upgrade after hours on Friday.
- Spreads have been set at today’s dual tranche 7-year BTP / 30-year BTPei syndication. MNI expects the 7-year size between E7-13bln. Greece also sold E200mln of the 3.875% Mar-29 GGB
- US retail sales data provides the main macro point of interest this afternoon.
US TSY FUTURES: Modest Rounds Of Long Setting & Short Cover Seen Tuesday
OI data points to fairly non-committal trade on Tuesday, with only modest rounds of net long setting and short cover seen across the curve.
- The only positioning swing that topped $1mn in DV01 equivalent terms came via net short cover in WN futures, which proved enough to tilt the curve-wide bias in the same direction.
| 15-Apr-25 | 14-Apr-25 | Daily OI Change | OI DV01 Equivalent Change ($) |
TU | 3,994,599 | 3,990,143 | +4,456 | +168,512 |
FV | 6,401,596 | 6,391,925 | +9,671 | +419,020 |
TY | 4,754,078 | 4,765,968 | -11,890 | -772,063 |
UXY | 2,221,109 | 2,220,633 | +476 | +42,168 |
US | 1,801,090 | 1,799,997 | +1,093 | +139,500 |
WN | 1,836,868 | 1,842,289 | -5,421 | -1,025,213 |
|
| Total | -1,615 | -1,028,076 |
GERMAN AUCTION RESULTS: Another Soft Auction; Buxl Futures Soften
Another weak German auction following yesterday’s soft 5-year sale. The 0% Aug-52 Bund saw a bid-to-cover ratio of 1.90x, below November 2024’s 2.41x. The lowest accepted price of 46.60 was also below the 46.615 pre-auction mid price. The secondary market price of this Bund has since fallen to 46.371 at typing.
- The 2.90% Aug-56 Bund was the first re-opening since March’s syndicated launch (a reminder that this launch came amidst German fiscal-announcement induced volatility). The 100.00 low price was above the 99.979 pre-auction mid, but the secondary market price is now 99.563.
- Buxl futures have softened ~50 ticks since the results were published, now +34 ticks at 123.68
