POWER: Spain to Delay Interconnectors with France to 2035

A fairly swift turn around from session highs for core global FI markets.

• Hedging surrounding the pricing of EUR IG issuance & the Austrian syndication will have applied some pressure.
• Elsewhere, oil has stabilised a little above session lows, but the bounce hasn’t been meaningful, so that won’t be a major contributor to the latest move in FI markets.
• Bunds still outperform Tsys and Gilts, with TY and gilt futures now close to unchanged on the day.

TD Securities initiate a tactical short in gold at $2533, targeting $2300 with a stop-loss at $2675

• They write that their flow-based analysis suggests that downside risks are now more potent in gold, and initiate a tactical short.
• TDS note that macro funds have scarcely held more gold than they do today, with their estimates now at levels that marked local highs in 2019 and 2016. CTAs are also effectively 'max long' and Chinese ETF outflows have resumed.
• They see Asia as on a buyer's strike in physical, with visible short positions remains near decade-lows, while narratives in gold markets are unanimously bullish. As such, they see significant risks to the near-term outlook tied to positioning, despite the strong fundamental backdrop.